GE Forced To Cut Dividend

GE Forced To Cut Dividend

http://www.washingtonpost.com/wp-dyn/content/article/2009/02/27/AR2009022702894.html

The ongoing global recession and the turmoil in the credit markets have forced industrial giant General Electric to cut its dividend for the first time since 1938. The 68% cut in the quarterly dividend may result in a debt rating downgrade for the company. General Electric, the world's biggest provider of aircraft leasing, jet engines, power-plant turbines, medical imaging machines and locomotives, announced that the dividend cut was a precautionary action.

The company’s chief executive Jeffrey R. Immelt said that the move was aimed at strengthening the company’s long-term future. The reduction is expected to result in annual savings worth $9 billion for General Electric which has a record of paying a dividend for 110 years.