BHP Billiton Limited (ASX: BHP) has had its credit rating cut from A+ to A by ratings agency Standard and Poor’s (S&P).

The iron ore miner’s senior secured notes have been cut from A+ to A, and its subordinated notes from A- to BBB.

Not only that, but S&P has also placed the company on ‘CreditWatch with negative implications’ pending the release of BHP’s first-half results for the six months to December 2015.

If that’s not a sign that BHP’s dividend is going to be slashed, I don’t know what is. CEO Andrew McKenzie has repeatedly stated that the company’s balance sheet and credit rating come first before dividends. The move by S&P is highly likely to see BHP abandon its Progressive Dividend Policy – or face further credit rating downgrades.

We’ll have more to come later today…

Discover the 'new breed' of blue chips that could take your portfolio higher in 2016

Forget BHP and Woolworths. These 3 "new breed" top blue chips for 2016 pay fully franked dividends and offer the very real prospect of significant capital appreciation. Click here to learn more.

The report is free! No credit card required.


Forget BHP and Woolworths. This "dirt cheap" company is growing like gangbusters, and trading on a 5.6% dividend yield, FULLY FRANKED (8% gross). With interest rates set to stay at these low levels for years to come, for hungry investors, including SMSFs, this ASX company could be the "holy grail" of dividend plays for 2016.

Enter your email below to discover the name, code and a full investment analysis in our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2016.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our">Financial Services Guide (FSG) for more information.

Motley Fool contributor Mike King has no position in any stocks mentioned. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.