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Buffett's Berkshire Downgraded by S&P With Negative Outlook

Warren Buffett at Berkshire Hathaway's 2013 shareholders meeting in Omaha, Neb.
Lacy O'Toole | CNBC
Warren Buffett at Berkshire Hathaway's 2013 shareholders meeting in Omaha, Neb.

Standard & Poor's downgraded Berkshire Hathaway's counterparty credit rating to "double A" from "double A plus" with a negative outlook, but affirmed its "double-A-plus" rating on the company's core operating insurance companies.

Following the report, Berkshire's Class B shares ticked slightly lower in pre-market trade. (Click here to track the company's stock.)

"The negative outlook reflects the U.S. sovereign ratings cap and our view that the group's capital adequacy per our capital adequacy model could deteriorate relative to its risk profile," said S&P in a release.

(Read more: Berkshire's 15 Biggest Stock Holdings)

Still, the agency said its ratings reflect its view of the company's strong financial risk profile, based on its strong capital and earnings.

"The lower credit rating on BRK better reflects our view of BRK's dependence on its core insurance operations for most of its dividend income," said Standard & Poor's credit analyst John Iten.

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