Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Life Insurance

Large Insurers Could Take CIT Hit

Your article was successfully shared with the contacts you provided.

Some major life insurance companies may be affected by the financial problems of a leading lender, according to U.S. analysts for Credit Suisse A.G., Zurich.

Credit Suisse released a report Thursday citing the exposures of American life insurance companies to a debt restructuring of financially troubled CIT Group Inc., New York. CIT admitted in a statement released Wednesday that it was not expecting government bailout money.

AFLAC Inc., Columbus, Ga., has the highest number of CIT securities, with a conditional fair value of $218 million, accounting for 3.3% of equity, excluding accumulated other comprehensive income, Credit Suisse notes.

Genworth Financial Inc., Richmond, Va., has the second-most in CIT securities with $140 million, which amounts to 1.5% of equity, excluding AOCI, Credit Suisse reports.

Lincoln Financial Corp., Radnor, Pa., is listed by the report as having $76 million in CIT securities. That makes up 1% of the insurer’s equity, excluding AOCI.

Protective Life Corp., Birmingham, Ala., has $32 million in CIT securities. That is 1.7% of Protective’s equity, excluding AOCI, according to the report.

Conseco Inc., Carmel, Ind., has $21 million in CIT securities, constituting 0.9% of their equity, excluding AOCI.

MetLife Inc., New York, has $87 million in CIT securities, and Prudential Financial Inc., Newark, N.J., has $41 million. However, neither amount adds up to more than 0.3% of equity, excluding AOCI, for either insurer, the report says.

A recovery rate between 50 and 60% on the securities is expected, according to the report.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.