S&P’s affirmed its “BBB-/A-3” counterparty credit rating on CNA Financial Corp. and its “A-” counterparty credit and financial strength ratings on CAN’s insurance subsidiaries after the senior debt rating on Loews Corp., which owns 90 percent of CNA, was placed on CreditWatch with negative implications in April. The outlook on these companies is stable.
The ratings on CNA and the members of CNA Financial Property/Casualty Group benefit from Loews’ strong commitment to its insurance subsidiary. Loews has injected $1.7 billion of capital into CNA in the past two years, and S&P’s expects that additional support would be provided if a material capital deficiency emerges at the property/casualty group.
If the rating on Loews is lowered by one notch, no revision of the ratings on CNA is expected. In the highly unlikely event that the rating on Loews is lowered by two notches, the ratings on CNA would be placed under review, and a one-notch downgrade of the company would be likely because S&P’s believes the financial flexibility CNA derives from Loews would be materially lower.
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