Fitch Rates Ohio National Financial Services Inc.'s $150MM Notes 'A-'.Business Editors NEW YORK--(BUSINESS WIRE)--March 21, 2003 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. has assigned an 'A-' rating to Ohio National 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. Inc.'s (ONFS) proposed issuance of $150 million, 10-year senior unsecured notes. At the same time, Fitch affirms all existing debt ratings of ONFS and affiliates. The rating affirmation affects $250 million of debt outstanding. The Rating Outlook is Stable. Fitch expects ONFS to use approximately $100 million of the proposed issue to bolster Ohio National Life The Ohio National Life Insurance Company, is headquartered in Cincinnati, Ohio. It was originally founded as a stock company in 1909 but converted to mutual company status in 1959. In 1998, Ohio National reorganized as a mutual insurance holding company. Insurance Company's (ONLIC ONLIC Ohio National Life Insurance Company (Cincinnati, OH; also seen as ONLI) ) capital position and support its continued growth objectives. ONLIC's statutory capital position was negatively impacted over the past year by bond losses, rapid growth in the individual annuity business and the recapture of a $375 million block of fixed annuity Fixed Annuity An insurance contract in which the insurance company makes fixed dollar payments to the annuitant for the term of the contract, usually until the annuitant dies. The insurance company guarantees both earnings and principal. business that was reinsured to an unaffiliated reinsurer re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. . Fitch expects ONFS to use the remaining $50.0 million to either buy back a portion of the existing senior notes due 2011, or to defease the $50 million of surplus notes due 2026. The ratings continue to reflect ONLIC's consistently strong profitability, favorable balance sheet fundamentals, and positive sales trends driven by expanded distribution and competitive products. While the company successfully markets through multiple channels, the core distribution lies in its career and personal producing general agents and through several marketing alliances with major financial institutions and stock brokerage firms. Fitch's primary concerns relate to ONFS's ability to fund the rapid growth that ONLIC is experiencing in the individual annuity business, the company's increasing financial leverage, which at 27% on a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis is approaching the high end of the range for the rating category, difficult financial market conditions and overall competitive pressures. Ohio National Mutual Holdings (ONMH) was established in 1998 and serves as the mutual holding company for the Ohio National Life Insurance Company (ONLIC), and its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Ohio National Life Assurance Corporation (ONLAC). The intermediate, stock holding company is Ohio National Financial services, Inc. (ONFS). Entity/Issue/Type Action Rating/Outlook Ohio National Financial Services Inc. --$150MM Proposed Sr. notes Assigned 'A-'/Stable; --$200MM Sr. notes due 2011 Affirmed 'A-'/Stable. Ohio National Life Ins Co. --Surplus notes Affirmed 'A'/Stable. |
|
||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion