S&P Lowers Outlook on LandAmerica Financial to Negative From Stable, Affirms Ratings

August 23, 2007

Associated Press

NEW YORK (AP) -- Standard & Poor's Ratings Services on Tuesday revised its outlook on LandAmerica Financial Group Inc., a provider of real estate transaction services, to negative from stable and affirmed its ratings on the company.

"The revised outlook reflects the challenging environment for all title insurers," said S&P credit analyst James Brender in a statement. "We believe mortgage originations will decline steadily between 2006 and 2009."

As a result, operating performance for title insurers will be strained for at least the next six quarters, S&P said.

The outlook would be revised to stable if LandAmerica demonstrates it can maintain profit margins in the low- to mid-single digits in the short term, S&P said.

If LandAmerica is unable to adjust its cost structure to at least partially offset the anticipated decline in revenue, S&P said it would lower the company's financial strength rating by one notch.

S&P affirmed its "BBB-" counterparty credit rating and senior debt rating on LandAmerica, and affirmed its "A-" counterparty credit and financial strength ratings on the company's title insurance subsidiaries. These ratings are investment-grade ratings.

Additionally, S&P affirmed the company's preliminary "BB+" subordinated debt and "BB" preferred stock ratings. These are junk bond ratings.

LandAmerica shares rose $1.80, or 3.3 percent, to $55.63 in morning trading.

Coopyright 2007 Associated Press

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North American Title Insurance Company (NATIC) is a seasoned title insurance underwriter, helping title agents to achieve their individual business goals for more than 50 years. Today, the company conducts real estate settlement services in 39 states and the District of Columbia through a network of experienced, independent agents.