S&P: For life insurers, TARP aid won't immediately boost ratings

Even though the Treasury has expressed the possibility to expand federal aid to life insurers, Standard & Poor’s Rating Services says not to expect higher credit ratings any time soon as a result of the bailout, according to a Friday Dow Jones News Service report. Word from Fitch Ratings indicates the capital infusion would temper downgrades if further woes developed:

“It could take several years for some of the companies that have experienced capital erosion to restore their position to previous levels, but S&P said participating in TARP would accelerate the effort. For companies that are facing fewer liquidity issues, eligibility would create additional financial flexibility at a key time when access to capital markets is reduced.