Fair value?, page-5

I assume it's a reaction to the credit downgrade.

The issue for GMA is that it's rating cannot be more than three notches above it's parent. The parent was downgraded so GMA was automatically downgraded as well. From the press release:

"Under their Group Rating Methodology, Genworth Australia is viewed by S&P as an insulated subsidiary of the Genworth Group’s core life insurance company, GLIC, and therefore Genworth Australia’s rating is capped at a maximum possible three notch differential to GLIC. Similar actions have been taken in respect of other Genworth Group entities. "

Regardless of whether the approach of the rating agencies is valid, the fact that GMA has been downgraded has implications for the pricing of its obligations and the amount of capital which needs to be kept in the business.

All that being said, IMHO the share price has over reacted to the downgrade.