CNA Financial Corporation announced a 2008 fourth-quarter netloss of $336 million, or $1.31 per share, and a full-year net lossof $299 million, or $1.18 per share.

The Chicago-based insurer attributed the results mostly toinvestment losses stemming from continuing turmoil in the financialmarkets.

In reaction, Moody's Investors Service affirmed CNA ratings, butrevised its outlook for CNA Financial Corp.'s senior debt andinsurance financial strength ratings to negative from stable due to"issues stemming from continued investment losses."

In 2007, CNA reported fourth-quarter net income of $164 million,or 60 cents per share available to common stockholders, andfull-year net income of $851 million, or $3.13 per share.

CNA reported 2008 fourth-quarter net realized investment lossesof $314 million, compared to a 2007 fourth-quarter net loss of $61million. For the year, CNA said net realized investment lossestotaled $841 million for 2008 versus a net loss of $203 million for2007.

For its total property-casualty operations, CNA reported a 2008fourth-quarter net loss from continuing operations of $115 million,versus 2007 fourth-quarter net income from continuing operations of$236 million.

Without the $238 million in investment losses for p-coperations, p-c operations saw 2008 fourth-quarter net operatingincome of $123 million.

In all of 2008, CNA reported $201 million in net income fromcontinuing operations for its p-c operations, compared to $1.1billion in 2007.

Minus $502 million in investment losses, p-c net operatingincome was $703 million in 2008.

The combined ratio for p-c operations was 89.1 for the 2008fourth quarter, compared to 98 in the 2007 fourth quarter. For allof 2008, CNA reported a combined ratio of 98, compared to 94.8 in2007.

Thomas F. Motamed, chairman and chief executive officer of CNA,said, "While our core business is strong, our fourth-quarter andfull-year results reflect the impact of the severe and prolongedturmoil in the financial markets on our investment income andrealized investment results."

Moody's, in the same announcement downgrading the company fromstable, affirmed CNA Financial's "Baa3" senior debt rating and the"A3" insurance financial strength ratings on Continental CasualtyCompany and members of its property-casualty insurance intercompanypool.

Moody's senior credit officer Alan Murray said, "Although CNA'sinvestment portfolio includes a well-diversified mix of municipal,corporate, structured and alternative instruments, we believe thatfurther losses of meaningful amount are likely to continue in 2009.However, the ultimate economic loss potential in these positions islikely to be significantly less than current market valuessuggest."

In affirming the ratings, Moody's cited CNA's leadershipposition in many major commercial and specialty property-casualtyinsurance lines in the U.S., its adequate capitalization, agenerally improved profitability and operational leverage profilein recent years, and the historically supportive parentage ofLoews.