While the North American subsidiaries of the troubled Swiss reinsurer Converium AG were being downgraded (see related article in “National”), the remainder of the group received some good news with the announcement from A.M. Best Co. that it has affirmed the financial strength rating of “B++” (Very Good) and upgraded the issuer credit rating (ICR) to “bbb+” from “bbb.”
Best also said it has removed the ratings from its “under review status,” and has assigned them a stable outlook.
“This rating action follows shareholders’ approval of Converium’s fully underwritten CHF 533 million (USD 420 million) rights issue,” said Best (See IJ Website Sept.29). The rating agency also indicated that the action reflects its “evaluation of the company’s latest business plan, which incorporates an estimated reduction in net premium written of over 50 percent in 2005. An offsetting factor in the rating is continuing risk from the company’s reserves.
The financial strength rating of B++ (Very Good) has been affirmed and the ICR upgraded to “bbb+” from “bbb” for the following companies:
— Converium AG
–Converium Rueckversicherung (Deutschland) AG
— Converium Insurance (UK) Ltd
The ICR of “bb+” of Converium Finance S.A. has been affirmed.
The debt rating on Converium Finance S.A.’s USD 200 million 8.25% guaranteed subordinated notes, due December 2032 (guaranteed by Converium Holding AG and Converium AG has been upgraded to “bbb-” from “bb+.”
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