General Electric felt the squeeze of the recent credit crunch Thursday as it was forced to boost how much interest it will pay on an upcoming corporate debt offering.
GE raised the yieldon its bond issue by 0.38%, compared to its September deal, the Financial Times reported Friday.
The high premium will cost the world’s biggest corporate borrower an additional $9.8 million a year and sends a clear signal to other corporations hoping to raise borrowed capital that higher premiums may be needed, the FT said.
GE is the first major company to issue bonds in the European market since July and the movegives investors an insight into how the corporate bond market has changed since the central banks around the world were forced in inject liquidity into a tight credit market.