DBRS Confirms Co-operators Financial Services Limited at BBB, Stable Trend

DBRS Limited (DBRS) has today confirmed both the Issuer Rating and the Senior Unsecured Debentures rating of Co-operators Financial Services Limited (CFSL or the Company) at BBB, with a Stable trend.

The ratings reflect the contribution from the Company’s core areas of operation: property and casualty insurance and life insurance. CFSL participates in these businesses through its ownership of Co-operators General Insurance Company (rated Pfd-3 (high); see separate report), Co-operators Life Insurance Company, and a 74.4% stake in Addenda Capital Inc., a large institutional manager with a focus on fixed-income investments. The Company continues to create a more diversified financial services group through the broadening of its distribution channels and product offerings as part of its vision of being the preferred provider of financial services to the Canadian co-operative movement.

While CFSL’s rating is limited by the corresponding ratings at its operating subsidiaries, the diversification of the Company’s consolidated product spectrum and distribution channels supports the rating. Conservative financial leverage is especially important, given the Company’s limited access to equity capital and the regulated nature of its major operating subsidiaries.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link to the right under Related Research or by contacting us at info@dbrs.com.

The applicable methodology is Rating Holding Companies and Their Subsidiaries (September 5, 2012).

This rating is endorsed by DBRS Ratings Limited for use in the European Union.

DBRS will publish a full report shortly that will provide additional analytical detail on this rating action. If you are interested in receiving this report, contact us at info@dbrs.com.