Warren Buffett was awarded compensation of $491,000 in 2008 for running Berkshire Hathaway Inc , which just lost its AAA credit rating from Fitch Ratings because of potential losses from derivatives.

Berkshire said Buffett's 2008 salary was $100,000, the same amount he has taken for a quarter century. He received $75,000 in director fees from companies in which Berkshire invests, and was provided with personal and home security services totaling $315,709.

Buffett, 78, has lived in the same Omaha, Nebraska, home, which sits on a three-quarter acre plot of land and is assessed at $727,600, for more than half a century.

Berkshire disclosed the compensation in a proxy filing with the U.S. Securities and Exchange Commission. It also said Buffett reimbursed Berkshire $50,000 for some personal expenses.

Buffett is the world's second-richest person, though his net worth fell to $37 billion from $62 billion a year earlier, Forbes magazine said this week. Only Microsoft Corp co-founder and Berkshire director Bill Gates is worth more.

Most of Buffett's net worth stems from Berkshire, which has close to 80 operating units and has tens of billions of dollars of stock and bond investments. Buffett owns 26.9 percent of the company and has a 31.8 percent voting stake, the proxy shows.

Fitch late Thursday downgraded Berkshire's so-called issuer default rating to AA-plus from AAA, and its senior unsecured debt rating to AA from AAA. Its outlook is negative, meaning another cut is possible within a couple of years.

The rating agency said Berkshire's equity and derivatives holdings leave its earnings stream and capital volatility inconsistent with the stability required at the 'AAA' level.

In 2008, Berkshire's profit tumbled 62 percent and its net worth slid by 9.6 percent, the worst year since Buffett took over in 1965, largely from paper losses on derivative contracts tied to stock market indexes. The contracts mature a decade and more from now, and Buffett expects them to be profitable.

Fitch also said its downgrade reflects key man risk, in that Berkshire's track record and ability to find companies to buy is intimately tied to Buffett. It said this risk factor has grown larger in the current stressful economic environment and is unrelated to Buffett's age.

Buffett has said Berkshire's board has someone to replace him as chief executive if the need arises, and will install one or more people to replace him as chief investment officer.

Moody's Investors Service and Standard & Poor's still rate Berkshire triple-A. Neither they nor Berkshire immediately returned calls seeking comment.

The cost of protecting Berkshire debt against default recently soared to a record level, more befitting a low-investment-grade or even junk-rated company.

Berkshire's Class A shares closed Thursday at $85,700, down 43 percent from their record high set in December 2007.

(Reporting by Jonathan Stempel; Additional reporting by Murali Anantharaman in Singapore; editing by John Wallace)

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