TIAA’s Statement on Decision by Moody’s to Affirm Triple-A ("Aaa") Rating
New York.- Today’s affirmation by Moody’s Investors Service reflects the strong capital position of the Teachers Insurance and Annuity Association of America (“TIAA”), according to Moody’s. Moody’s statement affirming the rating notes that “TIAA benefits from an exceptionally strong business and financial profile, evidenced by the company’s dominant position in the higher-education pension market, strong capital base, lack of financial leverage, uniquely stable liability structure with little liquidity risk, and very conservative products without any equity market-related guarantees. These advantages all serve to limit TIAA’s financial stress during a period in which many other life insurers have seen considerably greater strains.”
TIAA is one of just three U.S life insurance companies to hold an insurance financial strength rating of Aaa from Moody’s. In its statement, Moody’s also affirmed TIAA’s outlook as “stable” and noted that while “the company has not been immune to environmental stresses, having experienced significant investment losses, particularly in its real estate-related portfolio and structured investments…TIAA has substantial capitalization and flexibility to maintain its financial strength in what is a very difficult economic environment.”
Moody’s placed under review the issuer rating of TIAA, as well as the unconditional TIAA-guaranteed Aaa senior unsecured debt rating of TIAA Global Markets, Inc. (TGM). These ratings are separate from Moody’s Aaa insurance financial strength rating in the following ways. TIAA maintains the debt rating for TGM, which seeks to issue debt and earn a profit for the benefit of policyholders. TGM has a total investment of about $3.25 billion, less than two percent of TIAA’s total assets under management. TIAA has no outstanding corporate, long-term debt.
For more information on TIAA’s rating, see this list of questions and answers.
TIAA is rated A++, A.M. Best Company (as of 9/08); AAA, Fitch Ratings (as of 8/08); Aaa, Moody’s Investors Service (as of 5/09); AAA, Standard & Poor’s (as of 8/08) - the highest possible ratings from these independent analysts. These ratings do not apply to variable annuities, mutual funds, or any other product or service not fully backed by TIAA’s/TIAA-CREF Life’s claims-paying ability.
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