Fitch Affirms First American Corp's IDR at 'BBB'; Outlook Negative

CHICAGO--(Business Wire)--
Fitch Ratings has affirmed and removed the Rating Watch Negative
the ratings of First American Corporation (FAF) and its insurance
operating subsidiaries, as follows:

First American Corporation (FAF)

--Issuer Default Rating (IDR) at 'BBB';

--Senior unsecured debt at 'BBB-'.

First American Capital Trust

--Trust preferred securities at 'BB+';

First American Insurance Companies (First American Group or First
American). See below for a complete list of members.

--Insurer Financial Strength (IFS) at 'A-'.

The Rating Outlook is Negative.

On April 10, 2008 Fitch lowered all ratings of FAF one notch to
their current levels and placed the ratings on Rating Watch Negative.
The rating actions taken on April 10th reflected the significant
deterioration in First American's Risk Adjusted Capital (RAC) as
modeled by Fitch. Further, the Rating Watch was tied to management's
evaluation of capital at First American given the potential spin-off
of the title and specialty insurance operations which was scheduled to
be a third quarter event but has now been delayed to 2009.

During the second quarter of this year, FAF contributed to First
American Title Insurance Company (FATICO) $200.5 million. The transfer
consisted of $166.8 million in cash, marketable securities of $13.7
million, and a secured note of $20 million. This increase in surplus
coupled with a pro forma decline of approximately 20% in operating
expenses increases First American's 2008 pro forma RAC score to a
range of 105%-115% from a 2007 RAC score of 74%. While Fitch
recognizes the improvement in capital, both on an absolute and a risk
adjusted measure, the agency notes that relative to peers First
American continues to underperform.

The current Negative Outlook is indicative of the negative trends
not only in First American's capital, but also reserve levels and
profitability. Fitch will review the company's performance over the
next twelve to eighteen months to determine if the company's credit
profile is consistent with the current rating level. If Fitch
concludes that the company is operating in a manner inconsistent with
its current rating category Fitch would likely lower the ratings one
to two notches.

Fitch removes from Rating Watch Negative and affirms the
following. The Rating Outlook is Negative.

The First American Corporation

--IDR at 'BBB';

--Senior debt at 'BBB-';

--$200 million senior unsecured notes 2014 at 'BBB-';

--$100 million senior unsecured debentures due 2028 at 'BBB-'.

First American Capital Trust

--$100 million trust preferred security due 2012 at 'BB+'.

Fitch affirms the following IFS ratings at 'A-'. The Rating
Outlook is Negative.

--First American Title Insurance Company

--First American Title Insurance Co. of New York

--First American Title Insurance Co. of Oregon

--First American Title Insurance Co. of North Carolina

--First American Title Insurance Co. (UK) PLC.

--Land Title Insurance Co. of St. Louis

--Ohio Bar Title Insurance Co.

--Port Lawrence Title & Trust Co.

--Mortgage Guaranty & Title Co.

--Massachusetts Title Insurance Co.

--Western National Title Insurance Company

--United General Title Insurance Co.

--Pacific Northwest Title Ins Co

--Censtar Title Ins Co

--T.A. Title Ins Co

--First American Title Ins Co of KS

Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, www.fitchratings.com.
Published ratings, criteria and methodologies are available from this
site, at all times. Fitch's code of conduct, confidentiality,
conflicts of interest, affiliate firewall, compliance and other
relevant policies and procedures are also available from the 'Code of
Conduct' section of this site.

Fitch Ratings
Gerald B. Glombicki, +1-312-606-2354 (Chicago)
Doug Pawlowski, CFA, +1-312-368-2054 (Chicago)
Cindy Stoller, +1-212-908-0526 (Media Relations,
New York)

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