Nationwide units slip in S&P ratings

Standard and Poor’s Ratings Services today lowered its counterparty credit and financial ratings on Nationwide Financial, the life insurance division of Columbus, Ohio-based Nationwide Mutual Insurance Co., to A+, from AA-. The agency lowered the companies’ ratings in order to bring them into alignment with its A+ rating of the parent company and because of concerns about how the financial markets will continue to affect life insurers, Matthew Carroll, credit analyst at S&P, said in a statement. The New York-based ratings agency also cut the counterparty credit rating of the company’s retirement plan unit, Nationwide Financial Services Inc., to BBB+, from A-. S&P’s outlook for the operating units and the parent company is stable. The ratings actions came just before Nationwide Mutual reintegrates NFS into its mutual structure, effective Jan. 1. Despite the lower ratings, S&P expects the company to sustain capital adequacy and believes that Nationwide Financial’s retirement services segment will continue generating positive net flows and stable earnings contributions. As a result, S&P has removed the company from its CreditWatch negative list.