SLF Placed on Credit Watch Negative by S&P

Standard & Poors has announced:

it placed its ratings, including its ‘AA-‘ counterparty credit rating, on Sun Life Financial Inc. (TSX: SLF; Sun Life Financial) and its insurance operating subsidiaries (Sun Life) on CreditWatch with negative implications. Its key insurance operating subsidiaries would include Sun Life Assurance Co. of Canada and Sun Life Assurance Co. of Canada (U.S.).

“The CreditWatch placement reflects the deteriorating business and macroeconomic conditions that in our opinion are putting increasing pressure on the group’s earnings, investments, and capital adequacy position,” said Standard & Poor’s credit analyst Donald Chu.

While we believe that the sale of Sun Life Financial’s 37% stake in CI for C$2.3 billion has allowed it to strengthen its balance sheets at an opportune time, we believe that its fixed-charge coverage ratio is under pressure, and that it has limited room to issue debt or hybrids within the current rating category.

SunLife was recently downgraded by Moody’s following its 4Q08 Results.

SunLife has the following preferreds outstanding: SLF.PR.A, SLF.PR.B, SLF.PR.C, SLF.PR.D & SLF.PR.E.

One Response to “SLF Placed on Credit Watch Negative by S&P”

  1. […] announcement follows a Credit Watch Negative by S&P and a downgrade to Baa2 by […]

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