The counterparty credit rating on UnitedHealth Group Inc. (UNH) is based on its extremely strong earnings profile, very strong competitive position, good diversification, effective management strategy, and very strong financial flexibility. Slightly offsetting these strengths, UNH maintains high goodwill levels stemming from recent multiple acquisitions, and statutory capitalization that is considered good but below a level at which Standard&Poor's Ratings Services considers appropriate for the rating. We believe that until all of the firm's SEC filings are up to date, UNH is vulnerable to assertions of covenant defaults and possible unfavorable court interpretations, resulting in accelerated repayment of the debt security. UNH maintains good access to the external capital markets; it recently executed a $7.5 billion credit facility.
