Old Mutual, the South African based financial services group, has taken the rare step of publicly responding to a credit cut by Moody's, admitting the one-notch downgrade by the international ratings agency was "disappointing but no surprise".

Julian Roberts, group finance director at Old Mutual, said: "Old Mutual was put on the Moody's 'Negative Watch List' on January 27 2004, following the announced recapitalisation of our 53%-owned banking subsidiary, Nedcor. It was therefore not unexpected that they would follow through by reducing the rating."