General Electric has reduced the dividend by two-thirds
February 28, 2009 – 10:03 pmGeneral Electric Company on February 27 announced it plans to reduce the dividend by 68%, from 31 cents per share to 10 cents, which it estimated would save $9 billion a year, reports CNNMoney.com.
“We understand the importance of dividends to our shareholders and the importance of this decision, but we believe it necessary precautionary measure to further strengthen our company in the long term while maintaining the attractive dividend” – referred to in official statement of the Director General GE (target = “_blank”> GE) Jeff Immelta (Jeff Immelt).
“a revised level of competitive dividend and reflects our views on a reasonable payment for the current market,” – he added.
General Electric poised between dividends and its credit rating AAA. This rating allows the company to obtain cheaper loans, but requires a significant level of cash reserves.
Immelt stressed that the company’s strong financial position. “We have made tremendous progress in strengthening the balance of GE, the company providing significant capital and access to liquidity,” – he said.
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