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DEAN WITTER, DISCOVER & CO. SENIOR DEBT 'A+,' COMMERCIAL PAPER 'F-1' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Jan. 21 /PRNewswire/ -- Dean Witter, Discover & Co.'s senior debt will be rated A+' and its commercial paper F-1' by Fitch. The company plans to issue debt following the sale of 20 percent of its stock to the public in February. The remaining stock will continue to be owned by Sears Roebuck & Co. until a full divestiture planned for later in 1993. The credit trend is stable.
 The rating reflects the company's strong position within the credit card, asset management, and brokerage businesses, as well as its sound balance sheet and consistent earnings. Though all of its markets are competitive, Dean Witter and Discover, through creative and focused business strategies, have been successful in profitably building market share. These businesses represent the foundation of the company and virtually all of its earnings, with other affiliates involved in transaction processing and private label credit cards, home equity and other consumer lending, and the start-up Visa card operation, Prime Option.
 Following the company's restructuring, it will have a strong balance sheet with more than $2.7 billion of equity. On a proforma basis, the debt/equity ratio will be maintained at historical levels of about seven times, including both on- and off-balance sheet assets, and the equity/assets ratio will remain above 10 percent. Based upon the nature of the assets and the businesses in which Dean Witter, Discover operates, Fitch considers these capital levels to be strong. Furthermore, there will be no double leverage, and excess capital from all of the subsidiaries will be maintained at the parent for maximum flexibility. For funding, the company has access to diversified sources of funds, including deposits, asset-backed securitizations, and unsecured borrowings.
 Discover Card's growth patterns and loss experience are better than the industry, and the card is well-positioned to defend against ever- increasing competition. Dean Witter has also experienced strong and stable earnings growth attributable to its strong mutual funds effort, the absence of large principal risk-taking businesses, and a well- controlled expense base. Through the first nine months of 1992, Dean Witter, Discover earned $355.7 million, translating into an ROE of over 20 percent. Even with the start-up investment over the next several years in the Prime Option card, Fitch expects that earnings will continue to grow with a comfortable coverage of fixed charges.
 The Dean Witter Financial Services Group has historically operated independently from Sears. The entire management team will stay intact and operate with the same decentralized business focus that has been effective in the past.
 -0- 1/21/93
 /CONTACT: Nancy E. Stroker of Fitch, 212-908-0533/


CO: Dean Witter, Discover & Co. ST: New York IN: FIN SU: RTG

CK -- NY038 -- 7373 01/21/93 11:40 EST
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Publication:PR Newswire
Date:Jan 21, 1993
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