PHILADELPHIA, Nov. 4 /PRNewswire-FirstCall/ -- Lincoln Financial Group
(NYSE: LNC) today announced that Standard & Poor's ("S&P") affirmed its AA
counterparty credit and financial strength ratings on The Lincoln National
Life Insurance Company and Lincoln Life & Annuity Company of New York, and
revised its outlook for the insurance subsidiaries from positive to stable.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050830/LFLOGO )
Dennis R. Glass, president and CEO, commented, "We are pleased with the
affirmation of the financial strength ratings for our major insurance
subsidiaries. These ratings validate our commitment to meeting our obligations
to policyholders. S&P's actions corroborate the strength of our business model
and operating earnings, as well as our balanced investment portfolio, while
recognizing the difficult market environment."
S&P also affirmed the A+ counterparty credit rating on Lincoln National
Corporation and revised its outlook for the holding company from stable to
negative, citing among other factors the challenging macro-economic outlook
for the industry. The AA- counterparty and financial strength rating on
First-Penn Pacific Company was also affirmed with a revised outlook to stable.
Lincoln Financial Group is the marketing name for Lincoln National
Corporation (NYSE: LNC) and its affiliates. With headquarters in the
Philadelphia region, the companies of Lincoln Financial Group had assets under
management of $200 billion as of September 30, 2008. Through its affiliated
companies, Lincoln Financial Group offers: annuities; life, group life and
disability insurance; 401(k) and 403(b) plans; savings plans; mutual funds;
managed accounts; institutional investments; and comprehensive financial
planning and advisory services. Affiliates also include: Delaware Investments,
the marketing name for Delaware Management Holdings, Inc. and its
subsidiaries; and Lincoln UK. For more information, including a copy of our
most recent SEC reports containing our balance sheets, please visit
http://www.LincolnFinancial.com.
Forward-Looking Statements-Cautionary Language
Certain statements made in this release and in other written or oral
statements made by Lincoln or on Lincoln's behalf are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 ("PSLRA"). A forward-looking statement is a statement that is not a
historical fact and, without limitation, includes any statement that may
predict, forecast, indicate or imply future results, performance or
achievements, and may contain words like: "believe", "anticipate", "expect",
"estimate", "project", "will", "shall" and other words or phrases with similar
meaning in connection with a discussion of future operating or financial
performance. In particular, these include statements relating to future
actions, trends in our businesses, prospective services or products, future
performance or financial results, and the outcome of contingencies, such as
legal proceedings. Lincoln claims the protection afforded by the safe harbor
for forward-looking statements provided by the PSLRA.
Forward-looking statements involve risks and uncertainties that may cause
actual results to differ materially from the results contained in the forward-
looking statements. Risks and uncertainties that may cause actual results to
vary materially, some of which are described within the forward-looking
statements include, among others:
-- Continued deterioration in general economic and business conditions,
both domestic and foreign, that may affect foreign exchange rates, premium
levels, claims experience, the level of pension benefit costs and funding and
investment results;
-- Continued economic declines and credit market illiquidity could cause
us to realize additional impairments on investments and certain intangible
assets including a valuation allowance against deferred tax assets, which may
reduce future earnings and/or affect our financial condition and ability to
raise additional capital or refinance existing debt as it matures;
-- Uncertainty about the effectiveness of the U.S. government's plan to
purchase large amounts of illiquid, mortgage-backed and other securities from
financial institutions;
-- Legislative, regulatory or tax changes, both domestic and foreign, that
affect the cost of, or demand for, Lincoln's products, the required amount of
reserves and/or surplus, or otherwise affect our ability to conduct business,
including changes to statutory reserves and/or risk-based capital requirements
related to secondary guarantees under universal life and variable annuity
products such as Actuarial Guideline VACARVM; restrictions on revenue sharing
and 12b-1 payments; and the potential for U.S. Federal tax reform;
-- The initiation of legal or regulatory proceedings against Lincoln or
its subsidiaries, and the outcome of any legal or regulatory proceedings, such
as: (a) adverse actions related to present or past business practices common
in businesses in which Lincoln and its subsidiaries compete; (b) adverse
decisions in significant actions including, but not limited to, actions
brought by federal and state authorities and extra-contractual and class
action damage cases; ( c ) new decisions that result in changes in law; and
(d) unexpected trial court rulings;
-- Changes in interest rates causing a reduction of investment income, the
margins of Lincoln's fixed annuity and life insurance businesses and demand
for Lincoln's products;
-- A decline in the equity markets causing a reduction in the sales of
Lincoln's products, a reduction of asset-based fees that Lincoln charges on
various investment and insurance products, an acceleration of amortization of
deferred acquisition costs, value of business acquired, deferred sales
inducements and deferred front-end loads and an increase in liabilities
related to guaranteed benefit features of Lincoln's variable annuity products;
-- Ineffectiveness of Lincoln's various hedging strategies used to offset
the impact of changes in the value of liabilities due to changes in the level
and volatility of the equity markets and interest rates;
-- A deviation in actual experience regarding future persistency,
mortality, morbidity, interest rates or equity market returns from Lincoln's
assumptions used in pricing its products, in establishing related insurance
reserves and in the amortization of intangibles that may result in an increase
in reserves and a decrease in net income, including as a result of
stranger-originated life insurance business;
-- Changes in GAAP that may result in unanticipated changes to Lincoln's
net income, including the impact of Statement of Financial Accounting
Standards No. 157, "Fair Value Measurements," and SFAS No. 159, "The Fair
Value Option for Financial Assets and Financial Liabilities;"
-- Lowering of one or more of Lincoln's debt ratings issued by nationally
recognized statistical rating organizations and the adverse impact such action
may have on Lincoln's ability to raise capital and on its liquidity and
financial condition;
-- Lowering of one or more of the insurer financial strength ratings of
Lincoln's insurance subsidiaries and the adverse impact such action may have
on the premium writings, policy retention and profitability of its insurance
subsidiaries;
-- Significant credit, accounting, fraud or corporate governance issues
that may adversely affect the value of certain investments in the portfolios
of Lincoln's companies requiring that Lincoln realize losses on such
investments;
-- The impact of acquisitions and divestitures, restructurings, product
withdrawals and other unusual items, including Lincoln's ability to integrate
acquisitions and to obtain the anticipated results and synergies from
acquisitions, including Lincoln's ability to successfully integrate
Jefferson-Pilot's businesses, to achieve the expected synergies from the
merger or to achieve such synergies within our expected timeframe;
-- The adequacy and collectibility of reinsurance that Lincoln has
purchased;
-- Acts of terrorism, war or other man-made and natural catastrophes that
may adversely affect Lincoln's businesses and the cost and availability of
reinsurance;
-- Competitive conditions, including pricing pressures, new product
offerings and the emergence of new competitors, that may affect the level of
premiums and fees that Lincoln can charge for its products;
-- The unknown impact on Lincoln's business resulting from changes in the
demographics of Lincoln's client base, as aging baby-boomers move from the
asset-accumulation stage to the asset-distribution stage of life; and
-- Loss of key management, portfolio managers in the Investment Management
segment, financial planners or wholesalers.
The risks included here are not exhaustive. Lincoln's annual report on
Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and
other documents filed with the SEC include additional factors which could
impact Lincoln's business and financial performance. Moreover, Lincoln
operates in a rapidly changing and competitive environment. New risk factors
emerge from time to time and it is not possible for management to predict all
such risk factors.
Further, it is not possible to assess the impact of all risk factors on
Lincoln's business or the extent to which any factor, or combination of
factors, may cause actual results to differ materially from those contained in
any forward-looking statements. Given these risks and uncertainties, investors
should not place undue reliance on forward-looking statements as a prediction
of actual results. In addition, Lincoln disclaims any obligation to update any
forward-looking statements to reflect events or circumstances that occur after
the date of the release.
