S&P Affirms R&SA Puerto Rico ‘BBB’ Ratings

June 1, 2004

Standard & Poor’s Ratings Services announced that it has affirmed its ‘BBB’ counterparty credit and financial strength ratings on Royal & Sun Alliance Insurance (Puerto Rico) Inc. with a stable outlook.

“The ratings reflect the company’s strong capitalization and operating results; partially offset by its business concentration risk, an increasingly difficult competitive environment in its core Puerto Rican market, and its modest size relative to competitors,” stated S&P credit analyst Polina Chernyak.

The bulletin added that S&P “expects RSA PR’s capitalization to remain strong at more than 250 percent in 2003 and 2004.” ROR is projected to be between 12 and 15 percent, and premium growth is expected to be between 7 and 9 percent.

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