Ratings Roundup: CCR; PICL; AXA (Netherlands); MedQuake; Fondiaria-SAI; SNS Reeal

June 5, 2007

A.M. Best Co. has affirmed the financial strength rating of “A+” (Superior) and the issuer credit rating of “aa” of France’s Caisse Centrale de Reassurance (CCR) with a stable outlook. “The ratings reflect CCR’s unique position as the main reinsurer for French natural catastrophe and other extreme risks,” said Best. They are also based on CCR’s “superior risk-adjusted capitalization and very strong overall earnings.” The French government owns CCR, which assures payment of claims for catastrophic perils – mainly floods and storms – nuclear and terrorist risks. The presence of the government-nbacked reinsurer lowers the cost of primary coverage and makes it more widely available

A.M. Best Co. has affirmed the financial strength (FSR) rating of “B” (Fair) and issuer credit rating (ICR) of “bb+” of Ireland’s Primary Insurance Company Limited (PICL), removing it from the under review status applied to the rating in December 2006. Subsequently, Best said it has “withdrawn the FSR and has assigned an NR-4 (Company Request)” in response to PICL’s request that the company be withdrawn from the interactive rating process.

Fitch Ratings has placed AXA Schade’s and AXA Leven’s “AA” Insurer Financial Strength (IFS) ratings on its rating watch/negative following AXA’s announcement that it intends to sell the two Dutch operations to the SNS Reaal Groep for EUR1.75 billion ($2.35 billion) in cash (See IJ web site June 4). Fitch said the action reflects its view that “these companies’ strategic importance to AXA has materially changed and that the implicit support they have benefited from so far will not exist upon disposal.” Fitch said it would resolve the ratings watch once the transaction has been completed.

Standard & Poor’s Ratings Services has assigned its “BB-” senior secured debt rating to the $50 million series 1 class A principal at-risk variable-rate notes and its “B” senior secured debt rating to the $50 million series 1 class B principal at-risk variable-rate notes issued under the newly established shelf program, MedQuake Ltd., sponsored by Swiss Re (See IJ web site June 4).

Standard & Poor’s Ratings Services announced that its long-term counterparty credit and insurer financial strength ratings and outlook on Italy’s Fondiaria-SAI Group’s core operating companies (BBB/Positive/–) will “remain unchanged following its announced agreement with Banco Popolare di Verona e Novara (BPVN; A/Stable/A-1) and merger partner Banca Popolare Italiana (BPI; A/Stable/A-1) to acquire 50 percent of BPVN’s life insurance company, Italy-based BPV Vita (not rated).”

Moody’s Investors Service said it has placed the ‘A2’ senior debt rating, ‘A3’ subordinated debt rating and ‘P-1’ short term debt rating of SNS REAAL on review for possible downgrade following the announcement that the Company would acquire AXA NL, Winterthur NL and DBV from France’s AXA Group (See IJ web site June 4).


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