A.M. Best Affirms Financial Strength Ratings of XL Capital Ltd.; Assigns Debt Rating.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--March 21, 2001 A.M. Best Co. has affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the A+ (Superior) financial strength rating of XL Capital Ltd., (NYSE NYSE See: New York Stock Exchange : XL) and its group members and has assigned an "a" rating to existing senior debt of NAC See network access control. Re Corp., an intermediate holding company. The ratings reflect the group's global market capabilities, strong capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. , sustained earnings and demonstrated success of its management strategies. These strengths are derived from the group's specialist operating strategy, disciplined underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. approach, strong risk management capabilities and experienced management team. In addition, the group maintains a distinct competitive advantage as a Bermuda-domiciled organization given its favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. regulatory and tax environment. With a capital structure that comprises 7% debt to capital, XL Capital Ltd. maintains significant financial flexibility considering its conservative operating and financial leverages, the ability to access capital markets and the earnings stability of its operating subsidiaries An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity and rolling stock. . As an intermediate holding company, NAC Re Corp.'s senior debt rating is derived from the strength and contribution of its direct subsidiaries to the XL group and the implicit support provided by the ultimate parent, XL Capital Ltd. Through recent streamlining efforts and a number of significant acquisitions over the past several years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time XL group has strategically differentiated its market capabilities, enabling it to expand its distribution base and offer a broad range of high excess insurance and reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. products that meet the changing demands of its customers. The pending acquisition of Winterthur International will solidify so·lid·i·fy v. so·lid·i·fied, so·lid·i·fy·ing, so·lid·i·fies v.tr. 1. To make solid, compact, or hard. 2. To make strong or united. v.intr. the group's presence internationally--particularly in Europe--enhancing its distribution platform and providing long-term business prospects through cross-selling opportunities. XL group's structured finance segment and its presence in the Lloyd's market through Brockbank Group plc, a leading managing agency, add well-managed specialty sectors which have contributed to a stable and growing source of earnings for the group. Offsetting these positive factors are the ongoing market challenges associated with the group's large account and reinsurance segments, along with integration and financial risks associated with its large acquisitions in recent years. Additionally, XL Capital Ltd. carries a significant amount of goodwill associated with its acquisition of XL Re Ltd. (formerly Mid Ocean Reinsurance Ltd.). Nonetheless, the XL group has incurred minimal financial leverage associated with these acquisitions and has maintained excellent fixed charge coverage of its debt obligations. While recognizing its contribution to the group, A.M. Best is modestly concerned with the additional risk imposed by its structured finance products. XL Capital Ltd., headquartered in Hamilton, Bermuda, is a publicly traded holding company that, through its operating subsidiaries, provides a broad range of excess insurance and reinsurance products on both a traditional and non-traditional basis to a diverse group of multinational clients. At December 31, 2000, the company reported consolidated assets of $16.7 billion and shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. of $5.6 billion. The following A+ (Superior) financial strength ratings have been affirmed for the XL group of companies: XL Capital Ltd. XL Europe XL Insurance Ltd. (Bermuda) XL Re Ltd. (formerly XL Mid-Ocean Re Ltd.) XL Reinsurance America Group (formerly NAC Re Group) XL Reinsurance America Inc. (formerly NAC Reinsurance Corp) XL Insurance of NY XL Specialty Insurance Company Greenwich Insurance Company Indian Harbor Insurance Company NAC Reinsurance Corp. (Canada) NAC Reinsurance International Ltd. The following rating was assigned to existing debt: NAC Re Corp.--"a" rating on $100 million 7.15% senior notes, due 2005. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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