Unlike common and preferred stock dividends, the distributions made on fixed-rate capital securities are fully tax-deductible for the issuer, just like the interest payments on traditional debt instruments. Rating agencies have taken a positive view of this financing tool for the issuer, because it provides long-term capital and permits the deferral of payments should the issuer experience financial difficulties. However, as with preferred stock, such deferrals can only occur if the parent company stops all other stock dividend payments.