Fitch Affirms SCOR’s ‘BBB’ Rating

January 2, 2003

Fitch Ratings announced that it has affirmed the Insurer Financial Strength ratings of the SCOR Group at ‘BBB’ and the Long- and Short-term ratings of SCOR at ‘BBB-‘ (‘BBB minus’) and ‘F3’, respectively, and has removed them from “Rating Watch Negative” with a stable outlook.

Fitch said that SCOR’s recent success in raising additional capital (See IJ Website Dec. 27) of 381 million Euros ($399 million) “will support the group’s financial profile, which had been substantially affected by unexpected losses posted in the third quarter of 2002.”

“The group’s capital adequacy is considered adequate, based on the expected reduction of risk assumed for 2003. In addition, the more conservative investment policy implemented by the group has also contributed to a lower risk profile,” the announcement continued.

It also said that the success of SCOR’s capital raising efforts were a positive sign, reflecting “the support provided by shareholders for the ‘back on track’ recovery plans and the confidence expressed in the ability of the group’s new management team to reach financial targets set in the plan.” It warned however that “the group faces significant execution risk in the achievement of these objectives and that a return to adequate profitability may be a slow process.”

Fitch also noted that it considers “the group’s position as a top 10 global reinsurance operation, the withdrawal from several business areas the group considers unlikely to produce adequate returns in the near term, the planned reduction in risk undertaken for 2003, and the expected rise in premium rates and tightening of terms and conditions on the remaining portfolio, to be additional positive aspects supporting the current ratings.

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