Jefferies Finance's new issuance of $350 million in senior unsecured notes will facilitate significant loan growth and cause the company's leverage to rise beyond our previous expectation. As a result, we are lowering our ratings on the company and its existing senior unsecured notes by one notch each to 'B+' and 'B', respectively. We are assigning a 'B' rating to the company's proposed issuance of $350 million of unsecured notes. The outlook is stable. We expect the company's debt-to-equity ratio to rise and remain around 5x-6x for the next two years--without a material deterioration in liquidity, credit quality, or earnings. On March 25, 2014, Standard&Poor's Ratings Services lowered its issuer credit rating (ICR) on Jefferies Finance LLC (JFIN)
