A.M. Best Affirms Rating of Connaught Insurance Co.

July 15, 2003

A.M. Best Co. has affirmed the financial strength rating of B+ (Very Good) of Connaught Insurance Company Limited, the Guernsey-based single parent captive of Thomas Greg & Sons de Colombia S.A. The outlook is stable.

The rating reflects the company’s solid operating performance, strong risk-based capitalization, high levels of liquidity and cash flow and sound risk management practices. In addition, the rating recognizes Connaught’s integral role in facilitating the trading operations of its parent, Thomas Greg & Sons Limited (TG&S).

Offsetting rating factors include the company’s concentration on one predominant line of business, its status as a single parent captive, its size (surplus was USD 5.6 million at year-end 2002) and very substantial reliance upon reinsurance protection. The rating also reflects the volatility implicit in the type of business written both in terms of underlying risk and the availability and pricing of open market coverage, which has been evident in a much higher loss ratio for 2002, increased retentions and significantly increased reinsurance costs for 2003.

A.M. Best expects Connaught to continue to underwrite to an aggregate retention level that is consistent with its current rating level and to maintain a strong risk-adjusted capital position.

A.M. Best does not foresee any material changes in Connaught’s income stream or overall expense levels.

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