TEXT-Fitch rates CNO Financial Group credit facilities

(The following statement was released by the rating agency)

Oct 4 - Fitch Ratings as assigned a 'BB' rating to CNO Financial Group, Inc.'s

(CNO Financial) recently closed $725 million senior secured credit facility.

The newly rated credit facility is part of the holding company recapitalization plan that CNO Financial announced on Sept. 4, 2012. The size of the credit facility and certain other securities in the recapitalization plan has increased since the original plan was announced. Fitch estimates the financial leverage ratio under the new plan will increase to approximately 22% on a pro forma basis from 16.7% at June 30, 2012.

The credit facility consists of a $250 million four-year term loan facility, a $425 million six-year term loan facility, and a $50 million three-year unfunded revolving loan. Covenants are similar to those in the previous bank facility except certain terms and minimum covenant levels have been changed to reflect the evolution of the company's financial profile.

Key rating triggers that could lead to an upgrade include:

--Continued generation of stable earnings free of significant special charges; --Expansion of cushion versus existing covenant requirements or refinancing of the senior secured notes to create a debt profile consistent with peer life insurance companies; --Maintaining increased GAAP interest coverage ratio and NAIC risk based capital (RBC) above 6x and 350%, respectively.

Key rating triggers that could lead to a downgrade include:

--Combined NAIC RBC ratio less than 300% and operating leverage above 20x; --Deterioration in operating results; --Significant increase in credit-related impairments in 2012; --Financial leverage above 30% and Total Financing and Commitments ratio above 0.65x.

Fitch has assigned the following ratings:

CNO Financial Group, Inc. --$725 million senior secured credit facility rated 'BB'.

Additional information is available at '

'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research: --'Insurance Rating Methodology' (Sept. 22, 2011). Applicable Criteria and Related Research: Insurance Rating Methodology (New York Ratings Team)

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