Fitch Affirms Pacific LifeCorp's Debt and Insurance Ratings

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Fitch Ratings-New York-03 August 2007: Fitch Ratings has affirmed its ratings on Pacific LifeCorp (PLC) and its affiliates, including Pacific Life Insurance Company. A full rating list is shown below. The Rating Outlook is Stable.

PLC has reported strong earnings in recent periods and is expected to continue this trend over the next few years. After-tax GAAP operating income of $564 million in 2006 for the life insurance, annuities and mutual funds, investment management and corporate operations, including Aviation Capital Group
(ACG), represents a 20% increase relative to the prior year.

The organization's strengths include very strong balance sheet fundamentals, which includes modest financial leverage and very strong operating company NAIC risk-based capital ratios. Further, the company continues to maintain a high-quality asset portfolio, extensive liquidity and good asset/liability management. The company's asset portfolio has not been meaningfully affected by the subprime mortgage market.

Fitch's ratings concerns include the increase in variable annuity assets under management which create equity market exposures related to various benefit guarantees, interest rate exposure, and the company's ability to continue stable growth in earnings in its aircraft leasing operation, ACG.

Operating earnings are expected to maintain stability and a long-term upward trend. Fitch also expects the life insurance operation's risk-based capital ratio to remain above 400% of the company action level based on management's guidelines. Further, financial leverage is expected to remain conservative, with debt-to-capital near 20% for the insurance operations (backing out debt and equity related to ACG and other non-insurance operations with non-recourse borrowings). Non-recourse leverage measures at ACG are expected to modestly increase, but at a slower pace over the coming years. The organization is anticipated to remain a mutual holding-company structure, and any acquisitions are anticipated to be modest and aligned with current business strategies.

The following ratings are affirmed, Stable Outlook:
Pacific LifeCorp
--Long-term Issuer Default Rating (IDR) 'A+';
--$600 million 6.6% senior notes due 2033 'A'.

Pacific Life Insurance Company
--Long-term Issuer Default Rating (IDR) 'AA-';
--Short-term IDR 'F1+';
--Insurer Financial Strength 'AA';
--$150 million 7.9% surplus notes due 2023 'A+';
--Commercial Paper 'F1+'.

Pacific Life & Annuity Insurance Company
--Insurer financial strength 'AA'

Pacific Life Funding, LLC
--Funding Agreement-backed Note Program 'AA'.

Pacific Life Global Funding
--Funding Agreement-backed Note Program 'AA'.

Contact: Peter F. Patrino CFA, +1-312-368-3266, or Douglas L. Meyer CFA, +1-312-368-2061,
Chicago.

Media Relations: Kenneth Reed, New York, Tel: +1 212-908-0540.

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.