Voya 2014 Annual Report Download - page 194

Rating Agency
Financial Strength
Rating Scale
Long-term Credit
Rating Scale
Senior Unsecured
Debt Credit Rating
Scale
Short-term Credit
Rating Scale
A.M. Best(1) ........ “A++” to “S” “aaa” to “rs” “aaa” to “d” “AMB-1+” to “d”
Fitch(2) ............ “AAA” to “C” “AAA” to “D” “AAA” to “C” “F1” to “D”
Moody’s(3) ......... “Aaa” to “C” “Aaa” to “C” “Aaa” to “C” “Prime-1” to “Not Prime”
S&P(4) ............. “AAA” to “R” “AAA” to “D” “AAA” to “D” “A-1” to “D”
(1) A.M. Best’s financial strength rating is an independent opinion of an insurer’s financial strength and ability
to meet its ongoing insurance policy and contract obligations. It is based on a comprehensive quantitative
and qualitative evaluation of a company’s balance sheet strength, operating performance and business
profile. A.M. Best’s long-term credit ratings reflect its assessment of the ability of an obligor to pay interest
and principal in accordance with the terms of the obligation. Ratings from “aa” to “ccc” may be enhanced
with a “+” (plus) or “-” (minus) to indicate whether credit quality is near the top or bottom of a category.
A.M. Best’s short-term credit rating is an opinion to the ability of the rated entity to meet its senior financial
commitments on obligations maturing in generally less than one year.
(2) Fitch’s financial strength ratings provide an assessment of the financial strength of an insurance
organization. The National Insurer Financial Strength (“IFS”) Rating is assigned to the insurance company’s
policyholder obligations, including assumed reinsurance obligations and contract holder obligations, such as
guaranteed investment contracts. Within long-term and short-term ratings, a “+” or a “-” may be appended
to a rating to denote relative status within major rating categories.
(3) Moody’s financial strength ratings are opinions of the ability of insurance companies to repay punctually
senior policyholder claims and obligations. Moody’s obligations append numerical modifiers 1, 2, and 3 to
each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in
the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier
3 indicates a ranking in the lower end of that generic rating category. Moody’s long-term credit ratings are
opinions of the relative credit risk of fixed-income obligations with an original maturity of one year or more.
They address the possibility that a financial obligation will not be honored as promised. Moody’s short-term
ratings are opinions of the ability of issuers to honor short-term financial obligations.
(4) S&P’s insurer financial strength rating is a forward-looking opinion about the financial security
characteristics of an insurance organization with respect to its ability to pay under its insurance policies and
contracts in accordance with their terms. A “+” or “-” indicates relative strength within a category. An S&P
credit rating is an assessment of default risk, but may incorporate an assessment of relative seniority or
ultimate recovery in the event of default. Short-term issuer credit ratings reflect the obligor’s
creditworthiness over a short-term time horizon.
Our ratings by A.M. Best, Fitch, Moody’s and S&P reflect a broader view of how the financial services
industry is being challenged by the current economic environment, but also are based on the rating agencies’
specific views of our financial strength. In making their ratings decisions, the agencies consider past and
expected future capital and earnings, asset quality and risk, profitability and risk of existing liabilities and current
products, market share and product distribution capabilities, including implications of the ongoing divestment of
Voya Financial, Inc. by ING Group, among other factors.
Rating agencies use an “outlook” statement for both industry sectors and individual companies. For an
industry sector, a stable outlook generally implies that over the next 12 to 18 months the rating agency expects
ratings to remain unchanged among companies in the sector. For a particular company, an outlook generally
indicates a medium- or long-term trend in credit fundamentals, which if continued, may lead to a rating change.
Ratings actions affirmation and outlook changes by A.M. Best, Fitch, Moody’s and S&P from
December 31, 2013 through December 31, 2014 and subsequently through the date of this Annual Report on
Form 10-K are as follows:
• On February 17, 2015, S&P raised the issuer credit ratings on Voya Financial, Inc. and Voya Holdings
Inc. to BBB from BBB-. S&P also raised the senior unsecured credit ratings of Voya Financial, Inc. to
171