S&P Affirms Munich Reinsurance Rating

August 7, 2001

Standard & Poor’s has affirmed its “AAA” long-term counterparty credit and insurer financial strength ratings on leading global reinsurer, Munich Reinsurance Co. (MRC) and all core reinsurance members of the Munich Reinsurance group, as well as the core members of the ERGO Group (collectively Munich Re). The outlook is stable.

According to S&P, the ratings on MRC and other reinsurance units are based on Munich Re’s unsurpassed global business position, supreme capital strength, and extremely strong financial flexibility. The “AAA” ratings on American Re-Insurance Co. and Munich Reinsurance Co. of Australasia Ltd. also reflect explicit support from MRC.

Partially offsetting these strengths is the group’s overall operating performance, which is strong, but less than excellent, although the increasing proportion of primary insurance business is generating more enduring profitability, and the asset concentration risk implicit in the group’s stake in Allianz AG (AA+/Stable/A-1+), although the latter is expected to reduce going forward.

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