A.M. Best Assigns Ratings to SAFECO's Shelf Registration.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 6, 2003 A.M. Best Co. has assigned indicative ratings of "bbb+" senior debt, "bbb" subordinated debt Subordinated Debt A loan (or security) that ranks below other loans (or securities) with regard to claims on assets or earnings. Also known as "junior security" or "subordinated loan". and "bbb-" preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. to SAFECO Corporation's (Seattle) (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : SAFC SAFC South Australian Film Corporation SAFC Sunderland Association Football Club SAFC Securities America Financial Corporation SAFC South Australia Film Corporation SAFC Stirling Albion Football Club (UK) ) recently filed $775 million shelf registration. This filing encompasses $180 million of securities that remained available to SAFECO under a previous registration statement. SAFECO's existing debt and financial strength ratings on its property/casualty and life/health companies are unaffected, and all ratings were affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. with a stable outlook on December 4, 2002. A.M. Best expects issuances under the shelf registration to be used primarily to refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. existing debt and for general corporate purposes. Accordingly, SAFECO's debt to capital ratio (including capital securities) of approximately 30% will essentially remain unchanged. A.M. Best anticipates that SAFECO's fixed charge coverage will continue to improve toward the upper end of the four-six times range, reflective of the recent earnings improvement and lower interest expense. The ratings recognize SAFECO's enhanced financial flexibility due to reduced financial leverage at the holding company (facilitated by the sale of SAFECO Credit) as well as restructured debt obligations with staggered maturities staggered maturities In an investor's portfolio, bonds with differing maturity dates. For example, an investor may accumulate a $250,000 portfolio of bonds such that $10,000 face value of bonds matures each year for 25 years. . The ratings also reflect SAFECO's solid operating presence within the property/casualty industry, diversified earnings sources, sound capitalization and recently improved operating results following significant restructuring of its property/casualty operations. SAFECO's overall capital position was recently strengthened through its just completed equity offering; subsequently, contributions were made to its property/casualty and life/health insurance subsidiaries of $150 million and $100 million, respectively. SAFECO's positive rating factors are somewhat offset by the property/casualty group's unfavorable five-year operating results, primarily driven by poor pricing and rising claims costs in personal automobile, weather-related loss events, restructuring costs and commercial lines loss reserve strengthening. The following indicative ratings relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc SAFECO's shelf registration have been assigned: SAFECO Corporation-- -- "bbb+" senior debt rating -- "bbb" subordinated debt rating -- "bbb-" preferred stock rating For a list of A.M. Best's current debt ratings, please visit www.ambest.com/ratings/debtrating/companies.html. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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