S&P Lowers Ratings on Copenhagen Re

October 5, 2001

Standard & Poor’s announced that it has lowered its counterparty credit and insurer financial strength ratings on Denmark’s Copenhagen Re and its British subsidiary The Copenhagen Re Co.(U.K.) to double-‘B’ from single-‘A’-minus, but, although they remained on CreditWatch, it was no longer with “negative,” but with “developing implications.”

S&P also lowered the ratings of Copenhagen Re’s parent company Alm. Brand af 1792G/S (AB 1792) to triple-‘B’-plus from single-‘A’-minus. AL.Brand is in turn controlled by insurer AB 1792, whose ratings remain on credit watch with negative implications.

The action was taken following Copenhagen Re’s announcement that it had raised its anticipated losses from the terrorist attacks in the U.S. to be between $18.5 and $43.22 million, and its decision made shortly after September 11 to temporarily discontinue underwriting.

S&P considered that previously reported losses, plus the more recent news, had impaired the company’s stand alone rating, and had allowed its capitalization to fall below the level S&P “considers to be consistent with a strategically important subsidiary.” It also cited the “tightening of reinsurance pricing” as making it more difficult for Copenhagen Re to obtain ” the protection that would allow it to write business at historical volumes.”|”snp, lowers, ratings, on, copenhagen, re,

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