Conseco Inc. Placed On Credit Watch

April 10, 2000

Standard & Poor’s placed all of its ratings Friday on Conseco Inc. and its subsidiaries on CreditWatch with negative implications. The company’s corporate credit rating was lowered to BBB+, as was senior debt. Preferred stock was reduced to BBB-.

The rating action follows the extremely negative reaction in the capital markets to Conseco’s March 31 announcement that it was seeking a buyer for its Conseco Finance Corp. division and that the value of the accompanying interest only security was to be written down by about $350 million post-tax.

The resulting market turmoil has caused uncertainty concerning the level of proceeds Conseco will be able to realize from the sale of Conseco Finance, or even whether a sale can be successfully executed, as well as Conseco’s current financial flexibility. S&P will meet with Conseco management this week to discuss the status of Conseco’s proposed sale, as well as review the company’s financial flexibility.

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