A.M. Best Co. issued an announcement commenting on Munich Re’s first quarter earnings report, which recorded a $280 million net loss (See IJ Website June 2), indicating that the company’s ‘A++’ (Superior) rating was not in danger.
“Despite further write-offs in its investment portfolio, Munich Re’s risk-adjusted capitalisation remains superior,” said the bulletin. “A.M. Best recognises the significant improvement in Munich Re’s non-life reinsurance underwriting performance with a combined ratio of 96.8 as compared with 101.7% in the same period for the previous year. However, overall earnings have remained depressed.”
The rating agency said it would “continue to monitor Munich Re’s ability to achieve its operating performance targets–combined ratio below 100% and growth in embedded value operating earnings of more than 10% in 2003.”
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