S&P Assigns Aetna Inc. 'A-1' CommercialPaper Rtg.

Business Editors

NEW YORK--(BUSINESS WIRE)--Standard & Poor's

Oct. 30, 2000--Standard & Poor's today assigned its 'A-1' commercial paper rating to Aetna Inc. (Aetna). [pilcrow (paragraph sign)] This rating action applies to a restructuring of Aetna's $2 billion commercial

Aetna will continue its policy of maintaining 100% backup for its commercial paper outstanding, through two revolving credit facilities with two syndicates of banks. Once the merger of ASI into Aetna Inc. has been completed, Standard & Poor's will withdraw its ratings on ASI.

Standard & Poor's expects Aetna to terminate its existing restructured commercial paper program on completion of the sale of its financial services and international businesses to ING Groep N.V. (ING) (senior debt rating double-'A'-minus). At that time, ING will assume the existing long-term debt of Aetna, while Aetna is expected to repay its own short-term debt through establishing a new commercial paper program carried out by the surviving Aetna entity.

In the meantime, the existing long-term debt ratings on Aetna and the financial strength ratings on its wholly owned subsidiaries, Aetna Life Insurance & Annuity Co. and Aetna Insurance Co. of America, all remain on CreditWatch with positive implications, where they were placed on Aug. 17, 2000.

In the near future, legal ownership of Aetna Life Insurance Co. (ALIC), which is an integral part of Aetna's healthcare business, will likely be transferred to Aetna US Healthcare Inc. (AUSHC), in order to align Aetna's legal organizational structure with its business structure, prior to the sale of Aetna's financial services and international business to ING. This action will not affect Standard & Poor's financial strength rating on ALIC, which remains on CreditWatch with negative implications, where it was placed on Aug. 17, 2000.

After the sale of Aetna's financial services and international businesses to ING, AUSHC will be renamed Aetna Inc. and will consist of AUSHC and its subsidiaries, including ALIC and the Aetna global benefits business. At that time, Standard & Poor's will issue new ratings on the resulting entities and will resolve the CreditWatch status of ALIC.

Aetna Inc., Aetna Services Inc., Aetna Life Insurance & Annuity Co., Aetna Insurance Co. of America, Aetna Life Insurance Co., and Aetna US Healthcare Inc. are Security Circle insurers, which means that they voluntarily underwent Standard & Poor's most comprehensive analysis and were assigned ratings in one of the top four categories for financial security, Standard & Poor's said. -- CreditWire.

Credit Profile:

NEW RATING Aetna Inc.

Commercial paper(T)A-1

Copyright 2000, Standard & Poor's Ratings Services