A.M. Best Affirms Rating of St Paul International Insurance Company Limited.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Dec. 23, 2002 A.M. Best Co. has affirmed the financial strength rating of A (Excellent) of St Paul International Insurance Company Limited, London. The rating reflects the company's status as a core subsidiary of its ultimate parent, The St Paul Companies Inc., its very good risk-adjusted capitalisation and excellent business profile. Offsetting factors include weak, although improving, underwriting performance and potential exposure to the run-off operations relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc discontinued business. The outlook is stable. Core status - A.M. Best regards St Paul International as core to the U.S.-based St Paul. Following the significant restructuring of St Paul's global operations Global Operations is a first-person shooter computer game developed by Barking Dog Studios and published by both Crave Entertainment and Electronic Arts. It was released in March of 2002, following its public multiplayer beta version which contained only the Quebec map. in late 2001, the company continues to receive financial support. Capital has been provided through ordinary share issues totalling GBP GBP In currencies, this is the abbreviation for the British Pound. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 93 million (USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 148.8 million) in the last three years, in addition to a recently agreed subordinated loan In the field of finance, a subordinated loan is a type of loan which ranks after other debts should a company fall into receivership or be closed. It is also known as subordinated debt, or as junior debt. of GBP 21 million (USD 33.6 million). Very good risk-adjusted capitalisation - St Paul International maintains a very good level of capitalisation, primarily as a result of capital injections from its parent. A.M. Best expects the company to grow its shareholders' funds through the retention of earnings in 2002 and 2003, as a result of refocusing Noun 1. refocusing - focusing again focalisation, focalization, focusing - the act of bringing into focus its operations on the United Kingdom and Ireland only, exiting medical malpractice Improper, unskilled, or negligent treatment of a patient by a physician, dentist, nurse, pharmacist, or other health care professional. and construction lines, and the consequent expected return Expected Return The average of a probability distribution of possible returns, calculated by using the following formula: to operating profitability. Excellent business profile - St Paul International benefits from the globally recognised St Paul brand and reputation. The company has secured a significant market share in its core customer based business lines, which include solicitors' professional indemnity, transport, the public sector, automotive and technology. Poor underwriting performance - The company has experienced a sustained period of poor underwriting performance over the last five years, culminating in a combined ratio of 136.5% in 2001. Underwriting losses have attributed to the accumulation of significant retained loss reserves over this period amounting to GBP 87.9 million (USD 140.6 million) at year-end 2001. A.M. Best expects the recent restructuring and renewed focus on core business to lead to a marked improvement in performance in 2002 (combined ratio of below 107%). Expectations: - Near-term return to operating profitability, with a return on equity (ROE) of over 10% in 2002. - Growth in shareholders' funds through the retention of earnings, maintaining a very good risk-adjusted capitalisation. 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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