Standard & Poor’s Ratings Services said that its ‘AA-‘ insurer financial strength and long-term counterparty credit ratings on Zurich-based global reinsurance group Swiss Reinsurance Company (Swiss Re) are unaffected by the group’s announcement that it made a net loss after tax of CHF 304 million [$259 million] for the quarter ended Sept. 30, 2008 (See related article). The outlook on all ratings remains stable.
“When taken in the context of the extreme turbulence seen in financial markets during the third quarter, which has had a heavy impact on the results reported to date for most (re)insurers, the loss reported by Swiss Re is within expectations,” S&P explained.
The rating agency indicated that the “extent of the turbulence seen in financial markets during 2008” has been such that it “is viewing this as a ‘capital event,’ which means that our analytical focus will be on the resilience to investment-related losses shown by an entity’s capital position (rather than its earnings).”
S&P added that “despite the likelihood of further material write-downs during Q4, we continue to expect Swiss Re to hold a substantial surplus to our ‘AA’ level capital target for the financial year ended Dec. 31, 2008. Consequently, we expect that Swiss Re will be well placed to benefit from the more favorable underwriting environment we believe will emerge in 2009.
Source: Standard & Poor’s – www.standardandpoors.com
Was this article valuable?
Here are more articles you may enjoy.