S&P cuts Genworth, places on CreditWatch

Standard & Poor's said it lowered its financial strength ratings on Genworth Life Insurance Co., Genworth Life and Annuity Insurance Co. and Genworth Life Insurance Co. of New York to BB from BBB-. The agency placed the life insurance companies on CreditWatch developing.

The agency also lowered its counterparty credit and senior unsecured debt ratings on Genworth Financial Inc. and Genworth Holdings Inc. to B from BB-. It placed the holding companies on CreditWatch negative.

S&P also lowered its rating on guaranteed Genworth Financial Mortgage Insurance Ltd. to B from BB- (this rating is tied to that on Genworth Holdings). The agency placed Genworth Mortgage Insurance Corp. on CreditWatch negative.

The ratings on Genworth's Australia- and Canada–based mortgage insurance units remain unaffected and unchanged.

The lowering of the group credit profile to bb from bbb- and the downgrade of the U.S. life insurance companies reflect the announced suspension of traditional life and annuity sales, S&P’s reduced statutory earnings and surplus projections for the U.S. life division, and a prospective business profile that is less diversified and becoming more centered on mortgage insurance and long-term care – two businesses that have exhibited significant volatility historically.

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