Moody’s changes Ohio National view

Moody's Investors Service said it affirmed Ohio National Financial Services, Inc.'s Baa1 senior debt rating.

The outlook was revised to negative from stable.

The agency said the action follows the company's announcement on Sept. 6, whereby it will exclusively focus on life and disability income insurance businesses to drive long-term growth, no longer accept applications for annuities or new retirement plans, and reduce its workforce.

Moody’s said the change in outlook is primarily driven by the downward pressure on profitability and capital adequacy due to capital strain from above average new business sales, restructuring costs to exit the retirement business, the challenges to run-off its high risk profile concentration in variable annuities with guarantees relative to its other businesses and the transition risk the company's business strategy faces to compete in the highly competitive life insurance market dominated by larger competitors.

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