Conseco Inc. & Conseco Finance Rtgs Lowered By Fitch IBCA.Business Editors NEW YORK--(BUSINESS WIRE)--May 4, 2000 Fitch IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals has lowered all ratings related to Conseco Inc. (Conseco). These ratings remain on RatingAlert Negative. The ratings are listed below. The rating actions reflect a series of recent developments that include lower than expected first quarter 2000 operating results in the insurance segment, reduced financial flexibility as a result of continuing capital market concerns and Fitch IBCA's belief that given the current market environment, Conseco will be challenged to receive optimal valuation on the disposition of Conseco Finance. These events led to the resignations of Conseco's Chief Executive Officer and Chief Financial Officer on April 28. Fitch IBCA believes that Conseco's insurance subsidiaries are adequately capitalized and have not been materially impacted by holding company concerns to date. The rating actions on insurance subsidiaries represent the weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. position of the holding company given recent
developments.
Over the next several weeks, Fitch IBCA will continue to closely monitor developments related to the sale of Conseco Finance, financing capacity of Conseco Finance, initiatives to improve financial flexibility and potential impact of these issues on the insurance operations. If progress is not made or credit quality deteriorates, Fitch IBCA will consider further downward rating actions. On March 31, 2000, Conseco announced that it intends to sell Conseco Finance, its finance operation formerly known as Green Tree Financial Corp. (Green Tree). Conseco Finance has the dominant market position in the manufactured housing Manufactured housing (also known as prefab housing) is a type of housing unit that is largely assembled in factories and then transported to sites of use. In the United States, the term "manufactured home" specifically refers to a house built entirely in a protected sector, lending to both consumers and dealers. The company also has solid market positions in retail home equity and home improvement loans. On June 30, 1998, Conseco acquired Green Tree in a pooling-of-interest transaction valued at $6 billion. Conseco is a publicly traded holding company based in Carmel, Ind., with total assets of $52.2 billion and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. of $6.3 billion (excluding FAS 115) at Dec. 31, 1999. Conseco's insurance operation is a leading provider of universal life insurance, long-term care long-term care (LTC), n the provision of medical, social, and personal care services on a recurring or continuing basis to persons with chronic physical or mental disorders. insurance, Medicare supplement, specified disease insurance and equity-indexed annuities equity-indexed annuity A contract with an insurance company that promises periodic payments keyed in a specified manner to a stock market index. Unlike variable annuities, equity-indexed annuities specify a guaranteed minimum return that is typically 3%. . Fitch IBCA has taken the following rating actions and all ratings remain on RatingAlert Negative: Conseco, Inc.: --Senior debt downgraded from `BBB BBB A medium grade assigned to a debt obligation by a rating agency to indicate an adequate ability to pay interest and repay principal. However, adverse developments are more likely to impair this ability than would be the case for bonds rated A and above. +' to `BBB-', --Commercial paper downgraded from `F2' to `F3'. Conseco Finance Corp.: --Counterparty downgraded from `BBB' to `BB+'. Michael J. Barry 1-212-908-0621 (for info regarding Conseco Inc) and Thomas J. Abruzzo 1-212-908-0793 (for info regarding Conseco Finance), New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . |
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