Ap Two Insurers Rejcet Government Bailout Help
1
NOVEMBER 9, 2008 WASHINGTON —Two insurance companies have said they will not participate in the government’s rescue pro- gram to directly invest billions in financial companies. Some insurers likely would be eligible under the Treasury Department’s expanding plan or could apply to acquire thrifts to become so. Massachusetts Mutual Life Insurance Co. and New York Life Insurance Co., in separate announcements in recent days, said they are financially strong and have sufficient capital to meet their goals without government aid. As part of the financial rescue plan, the Treasury Department is spending $250 billion to directly buy shares in U.S. banks and other financial companies. Other indus- tries, notably automakers, have been clamoring for a piece of the bailout pie, and the program could be significantly widened in scope. As things now stand, insurance companies that own thrifts — which are federally regulated — are eligible to apply for the Treasury Department funds. A spokesman for the Office of Thrift Supervision, William Ruberry, said Friday that several insurers had informally expressed interest in possibly acquiring thrifts since the Treasury aid program was announced in mid- October. At least a dozen insurers currently own thrifts. The insurance industry appears to be split between life insurers, some of whom have asked to participate in the program, and property-casualty companies — which have said they aren’t interested. Chubb Corp., a major property-casualty insurer, told Treasury Secretary Henry Paulson in an Oct. 28 letter that “we do not believe that allowing property and casualty insurance companies to participate in the (Treasury pro- gram) is consistent with the stated purpose” of the law cre- ating it. That purpose is “to restore liquidity and stability” to the U.S. financial system, Chubb noted in the letter. In its announcement Friday, Springfield, Mass.-based MassMutual said “we have no intention of participating” in the program. “MassMutual is well positioned, and has the financial strength and capital necessary to meet the needs of our pol- icyholders and customers despite the current economic environment,” the company’s statement said. New York Life said Thursday that it is has “more capital than is required to maintain our Triple-A ratings.” “The company can meet all of its strategic objectives without government capital, its businesses are strong and profitable, and it is committed to remaining a mutual com- pany operating for the sole benefit of its policyholders,” New York Life said in a news release. Two insurers reject government bailout help Massachusetts Mutual, New York Life say they have plenty of capital Associated Press Newswires Marcy Gordon Copyrighted © 2008 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press. #1-25432666 Managed by The YGS Group, 717.399.1900. For more information visit www.theYGSgroup.com/reprints. The above article resulted from the following press release distributed by MassMutual on Nov. 7, 2008, regarding the U.S. Treasuryʼs proposal to include insurers in its Capital Purchase Program: MassMutual is well positioned, and has the financial strength and capital necessary to meet the needs of our policyholders and cus- tomers despite the current economic environment. For more than 155 years, MassMutual has maintained long-term focus, providing the strength and stability our policyholders expect. Our company is built on a reputation of financial strength, diversification and quality. Moreover, our mutual company structure enables us to manage with the long-term interests of our policyholders and customers in mind. Thus, we have not participated in any discussions directly with the Treasury, and we have no intention of participating in the Troubled Asset Relief Proposal (TARP) Capital Purchase Program. 6110 CRN201011-113521
Transcript of Ap Two Insurers Rejcet Government Bailout Help
NOVEMBER 9, 2008
WASHINGTON —Two insurance companies have saidthey will not participate in the government’s rescue pro-gram to directly invest billions in financial companies.
Some insurers likely would be eligible under theTreasury Department’s expanding plan or could apply toacquire thrifts to become so.
Massachusetts Mutual Life Insurance Co. and New YorkLife Insurance Co., in separate announcements in recentdays, said they are financially strong and have sufficientcapital to meet their goals without government aid.
As part of the financial rescue plan, the TreasuryDepartment is spending $250 billion to directly buy sharesin U.S. banks and other financial companies. Other indus-tries, notably automakers, have been clamoring for a pieceof the bailout pie, and the program could be significantlywidened in scope.
As things now stand, insurance companies that ownthrifts — which are federally regulated — are eligible toapply for the Treasury Department funds.
A spokesman for the Office of Thrift Supervision,William Ruberry, said Friday that several insurers hadinformally expressed interest in possibly acquiring thriftssince the Treasury aid program was announced in mid-October.
At least a dozen insurers currently own thrifts.
The insurance industry appears to be split between lifeinsurers, some of whom have asked to participate in theprogram, and property-casualty companies — which havesaid they aren’t interested.
Chubb Corp., a major property-casualty insurer, toldTreasury Secretary Henry Paulson in an Oct. 28 letter that“we do not believe that allowing property and casualtyinsurance companies to participate in the (Treasury pro-gram) is consistent with the stated purpose” of the law cre-ating it. That purpose is “to restore liquidity and stability”to the U.S. financial system, Chubb noted in the letter.
In its announcement Friday, Springfield, Mass.-basedMassMutual said “we have no intention of participating” inthe program.
“MassMutual is well positioned, and has the financialstrength and capital necessary to meet the needs of our pol-icyholders and customers despite the current economicenvironment,” the company’s statement said.
New York Life said Thursday that it is has “more capitalthan is required to maintain our Triple-A ratings.”
“The company can meet all of its strategic objectiveswithout government capital, its businesses are strong andprofitable, and it is committed to remaining a mutual com-pany operating for the sole benefit of its policyholders,”New York Life said in a news release.
Two insurers reject government bailout helpMassachusetts Mutual, New York Life say they have plenty of capital
Associated Press NewswiresMarcy Gordon
Copyrighted © 2008 The Associated Press. All rights reserved.The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.
#1-25432666 Managed by The YGS Group, 717.399.1900. For more information visit www.theYGSgroup.com/reprints.
The above article resulted from the following press release distributed by MassMutual on Nov. 7, 2008, regarding the U.S. Treasuryʼsproposal to include insurers in its Capital Purchase Program:
MassMutual is well positioned, and has the financial strength and capital necessary to meet the needs of our policyholders and cus-tomers despite the current economic environment. For more than 155 years, MassMutual has maintained long-term focus, providingthe strength and stability our policyholders expect. Our company is built on a reputation of financial strength, diversification and quality.Moreover, our mutual company structure enables us to manage with the long-term interests of our policyholders and customers inmind. Thus, we have not participated in any discussions directly with the Treasury, and we have no intentionof participating in the Troubled Asset Relief Proposal (TARP) Capital Purchase Program.
6110
CRN201011-113521
