THE FT today reports that US ratings agency AM Best has downgraded its financial strength ratings on...
THE FT today reports that US ratings agency AM Best has downgraded its financial strength ratings on 8 UK life companies because of the steep fall in the value of their equity assets in relation to liabilities.
CGNU Life Assurance, Commercial Union Life Assurance, Norwich Union & Pensions have been downgraded from "A-" to "B++".
Clerical Medical Investment Group and Scottish Widows have dropped from "A" to "A-".
Perl Assurance and Royal London Mutual Insurance have gone from "B++" to "B+".
Despite the downgrades, AM Best still believes the companies named are financially secure, the FT says.
ROLLS ROYCE the engine maker is facing a £1bn deficit in its pensions fund account The Times reports today, citing a new note from investment bank Merrill Lynch.
That means the deficit has widened by more than £400m since the start of the year, and plugging the gap could cost the company an extra £50m per year, ML warns.
Like BT earlier this week, RR has criticised what it sees as a simplistic use of FRS-17 rules that link company pension fund deficits to overall company accounts, and says that the next actuarial valuation is likely to find that the burden of carrying the deficit is far less than ML hints at.
GENDER and differences in earnings comes high up in the list of financial stories in The Scotsman today as the paper runs an article looking at the problem of planning for the future when you know that you will always be earning less than male colleagues.
And then there are the demographics of the IFA community that make it more difficult for women to get financial advice, the article argues.
"The majority of IFAs are male and over 50 and don't tend to specialise in areas women tend to need specialist advice, such as pensions on divorce and long-term care. During FSA consultation processes, IFAs' views are taken into account and can go toward shaping legislation and financial products, which are not necessarily geared towards women," writes Eve Callaghan of Edinburgh IFA firm Independent Women.
COMPULSORY liability insurance again hits the headlines of today's The Daily Telegraph, which says that premium rises of 600% are becoming common and causing shock to thousands of smaller businesses unable to afford the new rates.
Because there is no choice in the matter, companies must either pay up or keep doing their business on an illegal basis.
Many also have non-compulsory public liability insurance to pay out if customers have accidents, such as slip up on newly washed floors, but premium rises in this sector too are likely to leave more companies without cover.
The Telegraph quotes the ABI blaming the rise of the "blame culture" for an increase in litigation that is driving up insurance payout costs.
ONE of Wall Street's best known telecoms analysts is getting a $32m payoff to leave his current position at Salomon Smith Barney after the company came under increasing pressure from authorities investigating links between analyst recommendations and investment banking deals.
Jack Grubman is also extensively linked to the failed telecoms operator Worldcom, having actually advised the company's board on several occasions, the FT says.
The paper notes Grubman's comments yesterday that analysts such as himself were playing by established rules at the time and are now being "second guessed" by others.
THERE WERE mixed blessings in the US tech sector overnight as Dell Computer reported a strong rise in its latest quarterly earnings, but AOL Time Warner was told an SEC investigation into its accounting would continue.
AOL has now admitted that its accounting fell short even after it merged with Time Warner, and the SEC probe is now being widened, the FT reports.
The focus of the investigations is into advertising deals and how they were accounted for.
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