Standard & Poor’s Ratings Services has affirmed its “A” junior subordinated long-term debt rating on the €1.5 billion ($2 billion) undated, subordinated, fixed-to-floating rate bonds issued by global reinsurer Munich Reinsurance Co. (rated ‘AA-‘ – Stable). S&P said it “characterizes the bonds as “strong”, being at the upper level of its Category 2 (intermediate equity content) classification,” which reflects their “subordinated nature, optional and mandatory interest deferability, and the fact that the notes have no final maturity date. S&P credit analyst Karin Clemens explained that the “two-notch differential between the counterparty credit rating on Munich Re and the rating assigned to the proposed bonds reflects the bonds’ subordinated nature and optional interest deferability.”
Standard & Poor’s Ratings Services has affirmed its “BBB-” long-term financial strength and counterparty credit ratings on QBE del Istmo Cía. de Reaseguros Inc. (QBERIO) with a stable outlook. “The ratings are based on QBERIO’s conservative underwriting and reserving practices, good operating performance, geographic diversification across Latin America, and strong capitalization levels,” stated S&P credit analyst Alfonso J. Novelo. Some mitigating factors include the catastrophic nature of some of the company’s business lines, QBERIO’s exposure to changes in the pricing environment, and trends in reinsurance commissions.
Standard & Poor’s Ratings Services also affirmed its “BBB-” long-term financial strength and counterparty credit ratings on QBE del Istmo México, Cía. de Reaseguros S.A. de C.V. (QBEMEX) with a stable outlook is stable and the “mxAA” national scale rating on QBEMEX. “The ratings reflect our group methodology, under which we now consider QBEMEX a core subsidiary of QBE del Istmo Cía. de Reaseguros Inc.,” S&P explained (See previous rating). The stable outlook on QBEMEX reflects that of its parent company, QBERIO.
A.M. Best Co. has assigned a financial strength rating of “B-” (Fair) and an issuer credit rating of “bb-” to Russia’s Scandinavia Insurance Company Limited Liability Company (SIC) with a stable outlook. “The ratings of SIC reflect its adequate risk-adjusted capitalization and moderate operating performance,” said Best. Volatile underwriting performance and marginal business profile should be considered as offsetting factors. Best also indicated that it “believes the level of risk-adjusted capitalization is adequate for the rating assigned. The capital should be supportive of the company’s projected growth of 15 percent and in developing its business profile, which is predominantly marine hull and engineering risks.”
A.M. Best Co. has assigned an indicative rating of “bbb” to the forthcoming fixed/floating rate subordinated notes to be issued by Hiscox Plc, the intermediate non-operating holding company in the UK. The issue will carry a subordinated guarantee from Hiscox Ltd. (Bermuda), the ultimate non-operating holding company of the Hiscox group of companies. Best also assigned an issuer credit rating of “bbb+” to Hiscox Plc. The outlook for both ratings is stable. Best said it “anticipates that the notes will be used to replace the group’s short-term financing arrangements, fund the acquisition of a U.S. admitted carrier and for general corporate purposes.”
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