Moody's has updated its outlook on Advisor Group and Cetera Financial Group to "stable" from "negative." (Photo: Allison Bell/ALM)
Moody's has updated its outlook on Advisor Group and Cetera Financial Group holding company Aretec Group, returning each of the firms to "stable" from the "negative" outlook given to them in 2020.
However, Moody's maintained its Corporate Family Rating of B3 for each of them. B3 is the rating that it gives to firms considered speculative and subject to high credit risk.
The firms "acted quickly and effectively to adjust their businesses to the market disruptions, interest rate cuts and other operational challenges of the coronavirus pandemic," Moody's said in a report issued Tuesday.
The management at both independent broker-dealers "swiftly lowered expenses, raised efficiencies and adapted their operations to a new remote work environment," according to Moody's.
That "credit positive action proves the companies' ability to adapt, underpins our change in outlook on their ratings to stable from negative, and puts them in strong position to benefit from improving operating conditions and a strong, broad-based rise in equities markets," it said.
Advisor Group is "now on steady footing despite entering the coronavirus pandemic in a position of weakness," Moody's said, noting the BD had closed on its acquisition of Ladenburg Thalmann in February 2020.
