Moody's Investors Service gave a thumbs up to last week's announced $615 million sale of the HartfordFinancial Services Group's individual life business to PrudentialFinancial, despite the transaction reducing some of the Hartford'sdiversity in its income streams.

In its Weekly Credit Outlook, Moody's says the sale will allowthe Hartford “to focus on business in which it has greater scaleand competitive advantages.” To that end, Moody's calls thetransaction “a credit-positive” for the Hartford.

Moody's notes the sale is the third transaction in an overallrestructuring plan at the Hartford. Previously, the Hartfordannounced its sale of Woodbury Financial Services to AmericanInternational Group in July, and the sale of its retirement plansbusiness to Massachusetts Mutual Life Insurance Company inSeptember.

“Hartford Group said that after the sales it would shift itsfocus to strategically important business lines, namely propertyand casualty insurance, group benefits, and mutual funds,” saysMoody's Associate Analyst Stefan Kahandaliyanage in the WeeklyCredit Report. “In aggregate, the company expects the threeannounced transactions at closing will benefit Hartford Group's netstatutory capital, based on June 30 financials, by approximately$2.2 billion, including an increase of approximately $1.4 billionin statutory surplus and an $800 million reduction in requiredrisk-based capital.”

For Prudential, Moody's says the deal is credit neutral.“Although the acquisition will enhance its earnings, adddiversification and expand distribution, these benefits are offsetby integration risk and risk management challenges,” saysMoody's.