New York, November 14, 2012 -- Moody's Investors Service lowered all of Pitney Bowes, Inc.'s ("Pitney Bowes") long term debt ratings, including senior unsecured to Baa2 from Baa1, and affirmed the short term rating at P-2. The rating outlook is stable. The downgrades reflect Moody's concerns that the pervasive secular headwinds in Pitney Bowes' North America and International Mailing segments and a weaker macroeconomic environment could delay the company's turnaround efforts.

RATINGS RATIONALE

Pitney Bowes' Baa2 senior unsecured rating reflects the sizable market position of its core postal metering business within the mature office equipment industry. Nonetheless, Pitney Bowes faces particularly tough business challenges as its US meter equipment installed base is expected to continue to shrink due to the secular decline in traditional mail delivery. Moody's also expects Pitney Bowes to experience increasing competition from alternative online providers, especially as the company transitions its business model to expand the mix of revenue to digital hybrid, cloud-based and software offerings. Given the continued erosion in core mailing and production mail volumes, Pitney Bowes could target more frequent and larger acquisitions to offset revenue decline in the core business units and supplement its organic growth initiatives, which could also pressure its credit profile.

The stable outlook reflects Moody's view that despite the anticipated deterioration of revenues and operating margins in the near term, the company is in a position to address its business challenges, given its leverage position and longer term cash flow generating potential. The ratings and outlook are also supported by the company's ability to devote greater allocation of its cash resources to credit protection measures versus shareholder remuneration.

Pitney Bowes' ratings could be downgraded if debt remains at current levels absent EBITDA growth, the persistent revenue contraction is not reversed, the company loses greater market share, or does not maintain annual free cash flow above $200 million. Pitney Bowes' ratings could be upgraded if Moody's sees tangible progress in stemming the ongoing revenue erosion and stabilization of operating margins, and the company maintains leverage in the low 2 times levels.

Pitney Bowes' liquidity profile is adequate with $425 million of balance sheet cash as of September 30, 2012, the expectation of modest free cash flow and that its near-term debt maturity has been largely pre funded. Due to the recurring nature of roughly 80% of its revenue, Pitney Bowes generates steady free cash flow on an annual basis, with seasonal quarterly fluctuations. Going forward, Moody's expects normalized free cash flow over the next twelve months in the range of $100 - $150 million, after about $320 million in common and preferred dividends. Pitney Bowes also maintains access to external funding sources, including a $1 billion unsecured revolver, which has full availability at September 30, 2012. The company recently raised $220 million in term loan financing from its relationship banks to partially prefund upcoming 2013 maturities. Moody's expects the company to maintain sufficient liquidity to meet its upcoming maturities and have unfettered access to all segments of the capital markets.

Moody's also lowered the ratings on the preferred stock issued by Pitney Bowes International Holdings, Inc. ("PBIH") an indirect wholly owned subsidiary of Pitney Bowes to Ba1 from Baa3 Although the preferred stock holders have a structural priority claim on the cash flows from certain of Pitney Bowes international subsidiaries, relative to unsecured Pitney Bowes holders, PBIH operations generate modest cash flows relative to the US and have support agreements from Pitney Bowes.

Summary of Rating Actions:

Pitney Bowes, Inc.

Senior Unsecured -- Downgraded to Baa2 from Baa1

Senior Unsecured Shelf Rating - Downgraded to (P)Baa2 from (P)Baa1

Subordinate Shelf Rating - Downgraded to (P)Baa3 from (P)Baa2

Preferred Shelf Rating - Downgraded to (P)Ba1 from (P)Baa3

Short term rating -- Affirmed P-2

Rating outlook is stable

Pitney Bowes International Holdings, Inc.

Preferred Stock Rating - Downgraded to Ba1 from Baa3

Rating outlook is stable

The principal methodology used in rating Pitney Bowes, Inc was the Global Technology Hardware Industry Methodology published in September 2010. Other methodologies used include Loss Given Default for Speculative-Grade Non-Financial Companies in the U.S., Canada and EMEA published in June 2009. Please see the Credit Policy page on www.moodys.com for a copy of these methodologies.

Pitney Bowes, headquartered in Stamford, Connecticut, is a global provider of integrated mail, messaging and document management solutions that includes postage meters, mailing equipment and related document messaging services and software, mail and marketing services. Revenues for the twelve months (LTM) ended September 30, 2012 were $5.1 billion.

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