S&P’s Affirms White Mountains ‘BBB-‘ Ratings

May 9, 2003

Standard & Poor’s Ratings Services has affirmed its ‘BBB-‘ counterparty credit rating on White Mountains Insurance Group Ltd. (WTM) and its ‘BBB-‘ counterparty credit and senior unsecured debt ratings on WTM’s intermediate holding company, Fund American Companies Inc.

S&P’s also said it had affirmed its ‘A-‘ counterparty credit and financial strength ratings on WTM’s principal reinsurance operating subsidiary, Folksamerica Reinsurance Co., and added that “the outlook on all these companies has been revised to stable from negative.”

“The revised outlook is due to the substantial improvements in operating performance and business position of Folksamerica and WTM’s principal primary operating subsidiary, OneBeacon Insurance Group, and the very strong financial flexibility of WTM,” observed S&P’s credit analyst Damien Magarelli. “WTM’s financial flexibility is very strong and supports the stable outlook. Financial flexibility has improved because of the improved earnings at Folksamerica and OneBeacon as well as a reduction in debt obligations.”

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