Moody S Investors Service

Capmark Financial Group Inc., the lender owned by firms including Goldman Sachs Group Inc. and KKR & Co., filed for bankruptcy protection after posting a second-quarter loss of about $1.6 billion. The company listed consolidated debt of $21 billion and consolidated assets of $20.1 billion as of June 30 in Chapter 11 documents filed in U.S. Bankruptcy Court in Wilmington, Del. Horsham, Penn.-based Capmark is one of the largest U.S. commercial real estate finance companies, with more than $10 billion in originations, according to Moody's Investors Service.

Two major credit-rating firms gave California high ratings Monday on $8.8 billion of short-term notes that Treasurer Bill Lockyer plans to sell next week. Moody's Investors Service graded the debt MIG 1, the firm's highest rating. Standard & Poor's gave the notes a rating of SP-1, just below its top grade of SP-1-plus. The ratings could help draw orders for the notes from money market mutual funds and other institutional investors that may buy only high-quality, short-term debt.

Two out of three major bond-rating firms now agree: California is a B-grade credit -- and maybe worse. Moody's Investors Service on Tuesday cut the state's debt rating two notches, to Baa1 from A2, warning that the risk was rising that California could have trouble paying its bondholders if the budget stalemate in Sacramento didn't end soon. The firm said the state remained on its "watchlist" for further downgrades.