Fitch Downgrades FirstAm Ratings

The issuer default rating, senior unsecured debt rating, and certain other ratings of The First American Corp. have been downgraded by Fitch Ratings, which cited in part the results of the company's title insurance business. The company's IDR was downgraded from A-minus to BBB-plus, and the debt rating was downgraded from BBB-plus to BBB. Fitch pointed to First American's announcement that it expects an after-tax loss of $50 million or less in the fourth quarter and that its title insurance segment's results would be hurt by "further adverse reserve development." Fitch said the ratings have been removed from Rating Watch Negative (where they were placed after First American announced a plan to spin off its information services unit), but they have been assigned a negative rating outlook. The company had previously held one of the highest stand-alone IFS ratings among title insurance companies rated by Fitch. The rating agency said the downgrade "incorporates the underperformance of expectations and better aligns the company with peers."