S&P Puts Allianz ART Unit on CreditWatch

May 12, 2004

Standard & Poor’s Ratings Services announced that it has placed its “AA-” counterparty credit, insurer financial strength, and insurer financial enhancement ratings on Swiss-based Allianz Risk Transfer (ART) on CreditWatch with negative implications.

S&P also said it has placed the “A-1+” short-term counterparty credit ratings on ART on CreditWatch with negative implications. In addition, the “AA-” insurer financial enhancement ratings on ART’s two subsidiaries, Allianz Risk Transfer (Bermuda) Ltd., and Allianz Risk Transfer N.V., were also placed on CreditWatch with negative implications.

The rating agency explained that its actions reflect “concerns over the sufficiency of the proposed parental support agreements from Allianz AG (AA-/Negative/A-1+) for ART and its subsidiaries. For the ratings on ART to remain at the group rating level, the support documents must conform to Standard & Poor’s published criteria.”

S&P also said it was “uncertain of the potential impact that any rating triggers within the policies written by ART may have on the ratings.”

S&P credit analyst Paul Oates noted that the rating agency “expects to resolve the CreditWatch placement within 28 days, following which the ratings may be affirmed or lowered. The ratings on ART are unlikely to fall below the ‘A’ range, as ART’s stand-alone fundamentals remain strong.”

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