Fitch Ratings Affirms Teachers Ins. & Annuity 'AAA' Ratings.Business Editors CHICAGO--(BUSINESS WIRE)--May 22, 2002 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 affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the 'AAA' insurer financial strength rating of Teachers Insurance and Annuity annuity: see insurance. annuity Payment made at a fixed interval. A common example is the payment received by retirees from their pension plan. There are two main classes of annuities: annuities certain and contingent annuities. Association (TIAA TIAA Teachers Insurance and Annuity Association TIAA Travel Industry Association of America TIAA This Is An Acronym TIAA Texas Insurance Advisory Association (statistical reporting agency in Texas) TIAA Total Inactive Aircraft Authorization ) 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. , TIAA-CREF TIAA-CREF Teachers Insurance and Annuity Association - College Retirement Equities Fund Life Insurance Company (TIAA-CREF Life). At the same time Fitch has affirmed TIAA's 'AAA' long-term issuer rating and 'F1+' commercial paper rating. The Rating Outlook for all ratings is Stable. The ratings are based on TIAA's strong balance sheet, solid capital position and the organization's continued strong financial performance. TIAA's has a dominant market share in its core business of qualified individual retirement annuities for higher education higher education Study beyond the level of secondary education. Institutions of higher education include not only colleges and universities but also professional schools in such fields as law, theology, medicine, business, music, and art. professionals. TIAA's operating performance continues to benefit from its very low cost structure versus peers, providing it with a significant competitive advantage. TIAA's low cost structure is provided by significant economies of scale, no commissioned sales force, uniformity of contracts and collection of premiums on a payroll deduction basis. In 2001, TIAA exhibited another solid year of operating performance with key drivers being its continued low-cost structure and modestly lower investment yields. Profitability measures are good, especially considering TIAA's large capital base and non-profit status. Investment-related losses increased in 2001 due to the difficult economic environment but were not outside Fitch's expectations. Fitch considers TIAA's capital position to be very strong with a high level of risk-adjusted capital. The company reported adjusted surplus of $11.6 billion and total assets of $129.7 billion at year-end 2001. A very strong liquidity profile and significant positive cash flows from operations support TIAA's $2 billion commercial paper program. TIAA exhibits a very high liquidity ratio based on a large investment portfolio of investment grade bonds and a liability profile with low withdrawal risk. TIAA also has the additional flexibility to adjust policyholder Policyholder An individual who owns an insurance policy. dividends. TIAA and its companion organization, the College Retirement Equities Fund (CREF CREF College Retirement Equities Fund CREF Cross Reference CREF Connection Refused CREF Computer Ready Electronic Files CREF Capital Region Energy Forum CREF Computer Resources Evaluation Facility CREF Centre de Recherche en Ecologie et Forestrie ), form one of the world's largest private pension systems, based on total assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. at $274 billion at Dec. 31, 2001. TIAA by itself is the third largest U.S. insurer based on admitted assets. Since becoming a fully taxable entity in 1998, TIAA has in a controlled manner expanded its products and services into a number of complementary operations including personal and institutional trust services, tuition savings plan management, and mutual funds. Additionally, trust services and expanded investment products are now offered to those outside the company's traditional core market of education and research. TIAA Global Markets was established in the first quarter of 2002, operating a spread based investment management business. TIAA-CREF Life provides fixed and variable personal annuity products, as well as life and long term care products to both the general public as well as members of the TIAA retirement programs. Entity/Issue/Type Action Rating/Outlook Teachers Insurance & Annuity Association --Insurer financial strength Affirmed 'AAA'/Stable; --Long-term issuer Affirmed 'AAA'/Stable; --Commercial paper Affirmed 'F1+'. TIAA-CREF Life Insurance Company --Insurer financial strength Affirmed 'AAA'/Stable. |
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