Moody’s downgrades Genworth

Moody's Investors Service said it downgraded Genworth Holdings, Inc.’s senior unsecured debt to B2 from Ba3, Genworth Life Insurance Co.’s and Genworth Life Insurance Co. of New York’s insurance financial strength ratings to B2 from Ba3 and Genworth Life and Annuity Insurance Co.’s insurance financial strength rating to Ba1 from Baa2.

The actions follow the Oct. 2 announcement by Genworth Financial (unrated), the ultimate parent of Genworth Holdings, that it intends to refile its application with the Committee on Foreign Investment in the United States and evaluate options to address its upcoming debt maturities in the event the transaction with China Oceanwide Holdings Group Co. Ltd. (unrated) is not completed.

The ratings of Genworth's U.S. and Australian mortgage insurance operations are not part of this rating action. This is due to the meaningful separation that exits between Genworth's life and mortgage insurance businesses which mitigates the weaken financial flexibility, the agency explained.

Moody’s said the downgrade and continued review for downgrade was driven by continuing delays in obtaining required regulatory approvals for the planned acquisition of the company by China Oceanwide, which underline the risks to consummation of the transaction.

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