Fitch Rates Genworth's Junior Hybrids 'A-'; Outlook Stable.

CHICAGO -- Fitch Ratings assigns an 'A-' rating to Genworth Financial, Inc.'s (NYSE:GNW) $600 million enhanced junior subordinated notes due Nov. 15, 2066. The notes will pay a fixed rate of interest until May 15, 2016 and pay a floating rate based on three-month LIBOR plus 100 basis points with quarterly resets thereafter. GNW has the right to defer interest for up to 10 consecutive years. The notes may be redeemed by GNW on or after Nov. 15, 2016 at par plus any accrued and unpaid interest, or before Nov. 15, 2016 if certain changes occur in tax laws or rating agency actions or at certain redemption prices. Fitch also affirms the ratings on GNW, including the 'A+' Issuer Default Rating and the ratings of all senior unsecured debt ratings, preferred stock, and equity units (a full rating list is shown below). GNW's Rating Outlook is Stable.

Based on Fitch's new hybrid rating criteria published on Sept. 27, 2006, the notes have a high equity component. Fitch has assigned a class D designation to those notes that will allocate 75% of the principal to adjusted equity and 25% to adjusted debt in evaluating the financial leverage of GNW. Key features supporting the equity credit class of the notes include the junior subordinated ranking, 10-year deferral period, and a long maturity with no put provision. GNW's call option in 10 years is balanced by a replacement capital covenant (for the benefit of certain designated indebtedness of GNW) not to redeem the notes prior to 2036 unless replaced by the issuance of similar equity-like securities.

GNW's proforma equity-credited adjusted leverage of 20.8% at Sept. 30, 2006 compared to ratings expectations of less than 25%. GNW's debt servicing capability, through regulated U.S. life and mortgage operating entities, is strong and augmented by capacity from international entities.

Fitch rates the following:

Genworth Financial Inc.

--Enhanced junior subordinated notes 'A-'.

Fitch affirms the following:

--Long-term Issuer Default Rating at 'A+';

--Senior notes due 2007 at 'A';

--Senior notes due 2009 at 'A';

--Senior Yen notes due 2011 at 'A';

--Senior notes due 2014 at 'A';

--Senior notes due 2015 at 'A'.

--Senior notes due 2034 at 'A';

--Equity units at 'A-';

--Series A cumulative preferred stock at 'A-'.

--Commercial paper at 'F1'.

The Outlook for all ratings is Stable.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.