Fitch Affirms Penn Mutual Life's 'AA-' IFS Rating.CHICAGO -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. affirmed the insurer financial strength ratings of Penn Mutual Penn Mutual traces its beginning to 1847 when it became the seventh mutual life insurance company chartered in the United States. At the time of its organization there was a general distrust of stockholder-owned corporations so it was established as a mutual owned by its Life Insurance Company (Penn Mutual) and its wholly-owned subsidiary, Penn Insurance and Annuity Company, at 'AA-'. In addition, the 'A' surplus note rating of Penn Mutual was also affirmed. The Rating Outlook is Stable. Penn Mutual's rating is supported by an extremely strong risk-adjusted capital position, a competitive strategy focused on quality distribution, and a conservative management style encompassing investments, product design and asset/liability management Asset/Liability Management A technique companies employ in coordinating the management of assets and liabilities so that an adequate return may be earned. Also known as "surplus management. . Risk-adjusted capital compares favorably to peers and is considered more than adequate for the rating category. Total adjusted capital for Penn Mutual reached $1.2 billion at Sept. 30, 2004, representing a risk-based capital ratio Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. of 700% of the company action level. A $200 million surplus note issuance in June 2004 significantly bolstered surplus. Penn Mutual maintains a good competitive position selling individual life insurance and annuity products in the upper income market through an expanding and increasingly diverse distribution system, consisting of three channels: a career agency system, an independent financial network, and a network of broker/dealer representatives. Penn Mutual's investment portfolio focuses on investment grade, publicly traded fixed income securities, minimizing more risky investments such as mortgages, real estate, and equity securities. In addition, the company protects its interest margin with derivative securities Derivative security A financial security such as an option or future whose value is derived in part from the value and characteristics of another security, the underlying asset. , which reflects a solid, long-term management strategy. Janney Montgomery Scott, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control (JMS (Java Messaging Service) A programming interface (API) from Sun for connecting Java programs to messaging middleware such as IBM's MQSeries and TIBCO's Rendezvous. JMS is part of Sun's J2EE platform. See J2EE. JMS - Java Message Service ) is a full service regional broker/dealer that is wholly-owned by Penn Mutual, but operates independently. Its good reputation and independence from its parent enhance the value that JMS has as a broker/dealer. Entity/Issue/Type Action Rating/Outlook Penn Insurance and Annuity Co. --Insurer financial strength Affirm 'AA-'/Stable. Penn Mutual Life Insurance Co. --Surplus note $200 million, matures in 2034, 6% coupon, Affirm 'A'/Stable. --Insurer financial strength Affirm 'AA-'/Stable. |
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