Printer Friendly

AMERICAN ANNUITY GROUP SENIOR SUBORDINATED NOTES RATED 'BB-' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Jan. 20 /PRNewswire/ -- American Annuity Group, Inc.'s $100 million senior subordinated notes due 2003 are rated 'BB-' by Fitch. American Annuity Group (previously STI Group Inc.) is an insurance holding company, whose sole subsidiary is Great American Life Insurance Co., a writer of tax-deferred annuities marketed to employees of educational institutions and not-for-profit organizations. The credit trend is stable.
 The rating reflects the high level of double leverage at American Annuity Group as well as a high debt to total capitalization ratio projected to be 53 percent at year-end 1993. Interest coverage is moderate in the early years at 2.5x and is projected to increase as the debt is repaid.
 American Annuity is entirely dependent on the ability of Great American to generate sufficient earnings which will be upstreamed as dividends to repay the notes. Fitch believes Great American's business fundamentals are sound, with statutory earnings through Sept. 30, 1992 of $36.1 million. The company has the ability to generate sufficient earnings to repay the debt based on projected earnings which are reasonable based on historical performance. In addition to good operating results, the company's investment portfolio is conservative, with 92 percent in investment grade instruments. Nonetheless, in the event the dividend stream is curtailed, American Annuity's outside resources will be limited. This, added to the fact that these notes are subordinated to the senior bank lenders, increases the degree of risk associated with the debt.
 -0- 1/20/93
 /CONTACT: Lygia X. Campbell of Fitch, 212-908-0695/


CO: American Annuity Group, Inc. ST: IN: INS SU: RTG

PS -- NY016 -- 6754 01/20/93 09:28 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jan 20, 1993
Words:271
Previous Article:SCOTT SPORTS GROUP APPOINTS RALPH D. MURRAY NEW PRESIDENT FOR SCHWINN BICYCLE COMPANY
Next Article:FLORIDA RV SUPERSHOW SALES DOUBLED FOR WINNEBAGO INDUSTRIES
Topics:


Related Articles
AMERICAN ANNUITY GROUP PROPOSED SENIOR NOTES RATED 'BB' BY FITCH -- FITCH FINANCIAL WIRE --
AMERICAN ANNUITY GROUP'S $85 MILLION SENIOR NOTES RATED 'BB' BY FITCH -- FITCH FINANCIAL WIRE --
AMERICAN ANNUITY GROUP SENIOR/SUBORDINATED NOTES ON FITCHALERT POSITIVE -- FITCH FINANCIAL WIRE --
AMERICAN ANNUITY GROUP UPGRADED TO 'BB+/BB'; OFF FITCHALERT -- FITCH FINANCIAL WIRE --
Fitch Rates $1.2B Ares Leverage Investment Fund - Fitch Financial Wire -
Fitch Rates Protective Life Corp.'s Junior Subordinated Debt 'BBB+'.
Fitch Upgrades American Equity Investment Ratings.
Fitch Affirms American Financial Group, Inc. Ratings.
Fitch Downgrades Hartford Financial's IDR to 'A'; Outlook Negative.
Correct: Fitch: Government Support Overrides 4Q'08 Loss for Most AIG Ratings; Hybrids Downgraded.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters