Aug 11, 11:30BUSINESS WIRE Fitch Downgrades Conseco Rtgs
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Friday August 11, 11:30 am Eastern Time
Press Release
Fitch Downgrades Conseco Rtgs
Retains Negative Watch Status
NEW YORK--(BUSINESS WIRE)--Aug. 11, 2000--
Fitch, the international rating agency formed by the merger
of Fitch IBCA and Duff & Phelps Credit Rating Co.,
has taken several rating actions related to Conseco, Inc.
(Conseco) and its insurance and finance subsidiaries.
Fitch has downgraded Conseco's senior debt rating
to `BB-' from `BB' and
its preferred stock to `B' from `B+'.
These actions reflect
higher debt levels incurred during the second quarter of 2000,
reduced financial flexibility as a result of not selling Conseco Finance
and some uncertainty related to upcoming bank maturities.
Fitch expects the bank maturities to be resolved in the near term.
In addition, Fitch has downgraded the insurer financial
strength ratings of Conseco's insurance subsidiaries
(see list below)
to `BBB' from `A-'.
Although Fitch believes that the subsidiaries remain
well capitalized,
operating results declined during the first half of 2000.
This action also reflects the reduced financial flexibility of the holding company.
Also, Fitch has
downgraded Conseco Finance's senior debt rating two notches
to `B' from `BB-'.
The rating differential between Conseco and Conseco Finance
reflects
Conseco's weakened ability to provide financial
support,
Conseco Finance's increased financial leverage and asset
quality deterioration in recent periods.
All ratings remain on Rating Watch Negative.
Fitch expects to meet with Conseco's management after the
bank issue is resolved to discuss short-term and long-term
strategic plans.
Fitch has taken the following rating actions and all
ratings remain on Rating Watch Negative:
Insurer Financial Strength
-- Bankers Life & Casualty Insurance Company, from `A-' to `BBB',
-- Conseco Annuity Assurance Company, from `A-' to `BBB',
-- Conseco Direct Life Insurance Company, from `A-' to `BBB',
-- Conseco Health Company, from `A-' to `BBB',
-- Conseco Life Insurance Company, from `A-' to `BBB',
-- Conseco Life Ins. Company of New York, from `A-' to `BBB',
-- Conseco Medical Insurance Company, from `A-' to `BBB',
-- Conseco Senior Health Insurance Company, from `A-' to `BBB',
-- Conseco Variable Insurance Company, from `A-' to `BBB',
-- Manhattan National Life Insurance Company, from `A-' to `BBB',
-- Pioneer Life Insurance Company, from `A-' to `BBB'.
Conseco, Inc.
-- Senior Debt, from `BB' to `BB-',
-- Preferred Stock, from `B+' to `B'.
Conseco Financing Trust I through VII
-- Preferred Securities, from `B+' to `B'.
Conseco Finance Corp.
-- Senior Debt, from `BB-' to `B'.
Fitch is an international rating agency that provides global capital market investors with the highest quality ratings and research. Dual headquartered in New York and London with a major office in Chicago, Fitch rates entities in 75 countries and has some 1,100 employees in more than 40 local offices worldwide. The agency, which is a combination of Fitch IBCA and Duff & Phelps Credit Rating Co., provides ratings for Financial Institutions, Insurance, Corporates, Structured Finance, Sovereigns and Public Finance Markets worldwide.
--------------------------------------------------------------------------------
Contact:
Julie A. Burke, CPA, CFA 312/368-3158
Peter F. Patrino, CFA 312/368-3266
Chicago for Conseco Inc
or
Brian P. Quinn, 312/368-5464 Chicago,
Thomas J. Abruzzo, 212/908-0793
New York for Conseco Finance
or
Media Relations:
James Jockle, 212/908-0547, New York |
