Standard & Poor’s Ratings Services removed Brascan Financial Corp.’s ratings from CreditWatch today.

The firm’s ratings were placed under review back on Sept. 27, following Brascan Corp.’s announcement that Noranda Inc. and China Minmetals Corp. had entered into negotiations to sell 100% of Noranda’s common shares.

“The affirmation follows the review of Brascan’s core holdings, its investment policy, and the anticipated use of the proceeds from the potential sale of Noranda,” said Standard & Poor’s credit analyst Donald Chu. “Following the potential sale of Noranda, we expect Brascan to maintain a strong level of liquidity and keep its debt and preferred stock to total capital ratio at a manageable level,” Chu added.

The ratings on Brascan Financial reflect its strong and consistent growth in core earnings, solid capital base, and specialized industry knowledge in the niche markets in which it chooses to do business, the rating agency says.

Despite Brascan Financial’s good track record, the company faces challenges such as sector concentration, the need to maximize returns for a given level of risk, and the need to continue to boost earnings in a very competitive environment, it notes. “In addition, despite an increase in the amount of business conducted with third parties, the company still has a significant concentration of assets invested in and revenues from the Brascan group of companies.”

“The stable outlook reflects Standard & Poor’s expectation that Brascan Financial’s consistent financial performance will continue throughout the business cycle. Management remains focused on increasing the company’s level of diversification and fee-based businesses in an effort to continually improve Brascan Financial’s quality of earnings,” it concludes.

“Although capital levels are sufficient to withstand an economic downturn and invested assets are primarily in debt and preferred stock holdings, nevertheless, the concentration of investments in cyclical industry sectors and private equity holdings and the company’s increased appetite for financial leverage could subject the company to increased earnings volatility.”