S&P Announces: Fidelity National Financial Inc.'s $500M Shelf Assigned Preliminary Ratings.

Business Editors

NEW YORK--(BUSINESS WIRE)--Feb. 18, 2004

Standard & Poor's--On Feb. 18, 2004, Standard & Poor's Ratings Services assigned its preliminary 'BBB' senior unsecured debt, 'BBB-' senior subordinated debt, and 'BB+' preferred stock ratings to Fidelity National Financial Inc.'s (NYSE:FNF) $500 million universal shelf registration.

Standard & Poor's anticipates that the majority of the proceeds of the shelf will be used to finance FNF's aggressive growth plans for its non-title-insurance segments.

At the same time, Standard & Poor's revised its outlook on FNF to positive from stable. In addition, Standard & Poor's affirmed its 'BBB' counterparty credit rating on FNF and its 'A' counterparty credit and financial strength ratings on the seven title underwriting entities that -- on a consolidated basis -- constitute Fidelity National Title Insurance Cos. Group (Fidelity National).

Outlook

Interest rates and, consequently, FNF's title revenue could moderate in 2004 and lead to a material decrease in top- and bottom-line results in the first two quarters of 2004. Nevertheless, for full-year 2004, Standard & Poor's expects FNF to be able to maintain an expense ratio of less than 85% and earn an ROR of 15% through increased efficiencies. Furthermore, Standard & Poor's expects total debt to capital to remain less than 25% and for GAAP interest coverage to remain more than 10x.

Major Rating Factors

-- Very strong market position. As of year-end 2002, FNF

continues to be the market leader in domestic title insurance,

as demonstrated by Fidelity National's 29.3% national market

share, which is further underscored by the company's number

one position in 23 states. Though industry statistics are not

yet available for 2003, Standard & Poor's believes that

Fidelity National has the potential to cement its

market-leader status further through the proposed acquisition

of American Pioneer Title Insurance Co. (APTIC), which was

announced in October 2003. Fidelity National currently holds

the top market share in California, Texas, and New York; the

acquisition of APTIC would augment this position, as Florida

and the aforementioned states account for about half of

domestic title volume.

-- Increased earnings diversification. In the fourth quarter of

2003, FNF expanded its segment reporting to include the

Financial Institution Processing and Outsourcing segment

(FIPO). FIPO consists of Fidelity Information Services (FIS),

default management services, Eastern Software, and Softpro. In

April 2003, FNF acquired the Financial Services division of

ALLTEL Information Services (AIS was subsequently renamed FIS)

for $1.05 billion. FIS accounts for more than 80% of FIPO

revenue. The addition of FIS has added a source of earnings

diversity via a significant non-interest rate sensitive steady

income stream to the varied menu of FNF's real estate-related

products. Standard & Poor's considers FNF's growth plans to be

rather aggressive. However, FIS's dominance in the mortgage

servicing sector--as demonstrated by the company's 50% market

share in the processing of residential mortgage loans--and the

continuing consolidation among large loan originators allow

FNF to enjoy some cross-selling opportunities.

-- Expense ratio competitive advantage. As of Dec. 31, 2003, FNF

generated a market-leading 61% of its title revenue from

direct operations (including escrow and other title related

fees), resulting in an expense ratio of 79.4%, the lowest of

its industry peers. Standard & Poor's believes that FNF

derives a competitive advantage because of the lower

acquisition costs associated with the direct channel.

Offsetting FNF's lower expense load are the fixed cost and

overhead related to direct operations that must be trimmed

rapidly in a real estate downturn. However, FNF has

historically been able to shed overhead in times of moderating

mortgage originations.

-- Extremely strong operating performance. As of Dec. 31, 2003,

Fidelity National had the lowest combined ratio of its market

peer group at 82.8%. For this same period, Fidelity National's

rates of return -- an ROR of 17.3% and return on average

equity of 28.1% -- outperformed those of its peer group

average. Cash flow from operations was exceptionally strong at

almost $1.3 billion compared with $813 million as of year-end

2002.

-- Financial flexibility. As of Dec. 31, 2003, GAAP interest

coverage to service holding company debt was extremely strong

at 31.5x, and debt to total capital of 14.5% was down from 18%

as of year-end 2002. FNF's strong earnings from unregulated

sources should place less pressure on Fidelity National to

meet holding-company obligations. As the main operating entity

of FNF, Fidelity National has historically accounted for more

than 80% of FNF's pretax operating income.

Ratings List
Fidelity National Financial Inc.'s $500M shelf
    Preliminary senior unsecured debt rating        BBB
    Preliminary senior subordinated debt rating     BBB-
    Preliminary preferred stock rating              BB+

                                    TO                  FROM

Fidelity National Financial Inc.
    Counterparty credit rating      BBB/Positive/--     BBB/Stable/--
Alamo Title Insurance Co.
Chicago Title Insurance Co.
Chicago Title Insurance Co. of OR
Security Union Title Insurance Co.
Ticor Title Insurance Co.
Fidelity National Title Insurance Co.
Fidelity National Title Insurance Co. of New York
    Counterparty credit rating      A/Positive/--       A/Stable/--
    Financial strength rating       A/Positive          A/Stable

Complete ratings information is available to subscribers of RatingsDirect, Standard & Poor's Web-based credit analysis system, at www.ratingsdirect.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com; under Credit Ratings in the left navigation bar, select Credit Ratings Actions.