A.M. Best Rates Great-West Life's Trust Securities.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Dec. 18, 2002 A.M. Best Co. has assigned an "a+" rating to the C$350 million of Great-West Life Trust Securities - Series A, (GREATs) issued by Great-West Life Capital Trust, an open-end trust established in Ontario by the Great-West Life Assurance The Great-West Life Insurance Company (known more commonly Great-West Life) is a life and health insurance company. Its headquarters is located in Winnipeg, Manitoba, Canada and its CEO is Raymond L. McFeetors. Company (Great-West) (Winnipeg). Additionally, the Great-West Life Group's existing debt ratings have been affirmed and the financial strength ratings on the insurance operating subsidiaries remain unchanged. The outlook for all the ratings is stable. The "a+" rating recognizes that the GREATs are structured in a manner, which effectively ranks investors on an equal level with preferred shareholders of Great-West. The proceeds from the offering will be used for general corporate purposes. The innovative structure of the trust securities will provide Great-West with an overall higher quality of capital, as the trust securities qualify for Tier 1 capital Tier 1 Capital A term used to describe the capital adequacy of a bank. Tier I capital is core capital, this includes equity capital and disclosed reserves. Notes: Equity capital includes instruments that can't be redeemed at the option of the holder. treatment by OSFI OSFI Office of the Superintendent of Financial Institutions (Canadian) OSFI Open Standards Fabric Initiative OSFI Open System File Interface . Moreover, given the current low interest rate environment, Great-West will enjoy a lower cost of capital and enhanced interest coverage. Great-West has solid market positions in its core business lines, along with a superior operating performance, strong debt service capabilities and a solid capital position. Great-West's long-standing favorable earnings posture is reflected in its large portion of fee-based revenue, conservative pricing practices, low cost structure and meaningful economies of scale in the retirement savings, individual life and disability and group market segments in Canada. Furthermore, Great-West Life & Annuity Insurance Company's (GWL&A) (Greenwood Village, CO) strong market position in the U.S. 401(k) and medical self-funded businesses contribute significantly to Lifeco's consolidated earnings. Great-West's well-established core Canadian business Canadian Business is the longest-publishing business magazine in Canada. It was founded in 1928 as The Commerce of the Nation, the organ of the Canadian Chamber of Commerce. The magazine was renamed Canadian Business in 1933. segments are supplemented by reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. operations that add to its operational and earnings diversification. A.M. Best believes the consistent flow of earnings from Great-West's core insurance businesses are sustainable and provide ample liquidity to strongly support long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. service capabilities. Moreover, Great-West benefits from the strength and support of its ultimate parent, Power Corporation of Canada Power Corporation of Canada TSX: POW.SV is a major Canadian company with assets in North America and Europe in a number of industries. These industries include media, pulp and paper, and financial services. (Power), a Montreal-based diversified holding company with significant interests in financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. and communications. As major contributors to the parent company's overall results, Great-West and GWL&A's operations are integral to Power's business strategy. As of September 30, 2002, Great-West Lifeco The Great-West Life Assurance Company (known more commonly as Great-West Life) is a life and health insurance company. Its headquarters is located in Winnipeg, Manitoba, Canada and its CEO is Raymond L. McFeetors. reported consolidated assets (including segregated funds) of C$94.4 billion and capital stock and surplus of C$4.7 billion. The following debt rating has been assigned:
Great-West Life Capital Trust--
-- "a+" rating on C$350 million Great-West Life Trust
Securities Series A
On December 31, 2002, the following securities are scheduled for redemption and at that time A.M. Best will withdraw their ratings:
London Insurance Group Inc.--
-- "a+" rating on Series D, C$125 million 7.25%
Non-Cumulative Class 1 Preferred Shares
-- "a+" rating on Series E, C$125 million 7.20%
Non-Cumulative Class 1 Preferred Shares
Great-West Lifeco Inc.--
-- "a" rating on Series B, C$100 million 7.45%
Non-Cumulative First Preferred Shares
Great-West Lifeco's life insurance operating subsidiaries are Great-West Life & Annuity Insurance Co, First Great-West L & A Ins Co, Great-West Life Assurance Company and London Life Insurance Company London Life Insurance Company is a Canadian life insurance company best known for its "Freedom 55" slogan, evocative of saving money to an extent that would allow one to retire at age 55. . All have financial strength ratings of A++ (Superior) and are unaffected by this action. For a comprehensive list of the Great-West group's debt and HMO HMO health maintenance organization. HMO n. A corporation that is financed by insurance premiums and has member physicians and professional staff who provide curative and preventive medicine within certain financial, ratings, please visit www.ambest.com/press/great-west4.pdf. 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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