Rating agency Standard & Poor's has moved its view of Standard Life from stable to negative. The move mirrors the downgrade made by Moody's, another rating agency, a month ago.
Despite the downgrade, Standard & Poor's commented they believed Standard Life would continue to be a market leader. A spokesperson for Standard Life said that the company was disappointed with the downgrade. However, they are apparently still confident that the rating reflects their high business position and continued financial strength.
Our View
The fact that Standard Life have been downgraded reflects concerns from rating agencies on the company's financial strength and their overall and ongoing ability to meet liabilities. The downgrade should not be looked at in isolation, even though two rating agencies have followed the same route. Standard & Poor's still expect the company to remain as a market leader and this should give at least some reassurance to policyholders.
With the financial markets still trying to recover from the past three years of poor performance it will be interesting to see how the rating agencies change their views over the next year or so.Search the archive for other stories about Standard Life.