Fitch affirms AFG, units' ratings

Fitch Ratings said it has affirmed the BBB+ long-term issuer ratings of American Financial Group Inc. and its subsidiaries American Premier Underwriters Inc. and Great American Financial Resources Inc.

Fitch also affirmed the insurer financial strength ratings of AFG's property/casualty subsidiaries and life insurance subsidiaries at A+ and affirmed Great American Financial Resources' trust originated preferred securities (TOPrS) at BBB.

The outlook is stable.

Fitch said that during 2003 American Financial Group successfully sold its personal lines property/casualty business in two separate public offerings to focus on its specialty commercial lines business. The life operations occupy a good niche in the qualified annuity market, which is typified by profitable and persistent business.

The organization remains challenged to reduce financial leverage and improve expense efficiency. Profitability remains a concern for the life operation, and fixed annuity writers in general, as the low interest rate environment squeezes interest margins.

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