S&P Affirms-W/draws Old Republic Mercantile Rating

Standard & Poor’s Ratings Services announced that it has affirmed its ‘AA’ counterparty credit and financial strength ratings on Old Republic Mercantile Insurance Co., and has subsequently withdrawn the ratings at the company’s request.

“The ratings withdrawal has no effect on the ratings on Mercantile’s parent company, Old Republic International Corp. (ORI; A+/Stable/A-1), or any of Mercantile’s rated affiliates,” said S&P.

The rating agency explained that “Mercantile is a very small internal reinsurer, which assumes business from its affiliate Old Republic Insurance Co. (ORINSCO). Mercantile plans to commute all outstanding reserves and obligations back to ORINSCO on July 1, 2004, and to cease operations at that point. Subsequent to the commutation, company management plans to merge Mercantile with another ORI affiliate, sell the shell to an outside third party, or completely dissolve the company.”