NEW YORK -- Standard & Poor's Corp. assigned a B rating to the $50 million increasing-rate, redeemable, cumulative preferred stock of First Banks Inc., Creve Coeur, Mo.

S&P said the rating reflected the holding company's relatively low asset risk and strong consolidated liquidity. The strengths were somewhat offset, however, by an aggressive strategy of acquisitions financed with bank debt.

Consequently, the holding company is highly leveraged and encumbered with numerous financial performance covenants that are part of the bank loan agreement, S&P said.

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