S&P affirms First American

Standard & Poor's said it affirmed its BBB+ counterparty credit and senior debt ratings on First American Corp.

The outlook is stable.

The agency said it has closely monitored FAF internal investigation into its accounting for employee stock options and based on the findings of the special subcommittee, it does not view this issue as material to its credit analysis.

S&P said it has also reviewed the company's $155 million loss reserve strengthening.

The ratings reflect the company's access to the earnings of First American title, the significant dividend capacity of its non-insurance, less regulated subsidiaries, good liquidity, a conservative investment portfolio and strong leverage and coverage metrics, the agency said, noting that offsetting the company's strengths is the cyclical downturn in the title insurance industry, significant intangible assets that have limited liquidity and the adjustments in 2006 for adverse loss reserve development and improper accounting for stock options.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.