A.M. Best Affirms Ratings of AXA Corporate Solutions.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 13, 2003 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 financial strength ratings of A (Excellent) of AXA AXA Anguilla, Anguilla (Airport Code) AXA Alpha Chi Alpha AXA Animal Crossing Ahead (online forum community/guide to the game Animal Crossing) AXA Auxiliary Artery Corporate Solutions (AXACS), France, and its core subsidiaries. (See list below.) The ratings have been removed from under review and assigned a negative outlook. In a separate press release, several rating actions have been taken on the U.S. operations of AXA Corporate Solutions (AXA Corporate Solutions Insurance Company, AXA Corporate Solutions Excess and Surplus Lines Insurance Company, AXA Corporate Solutions 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. , AXA Corporate Solutions Life Reinsurance, AXA Re America Insurance Company, AXA Re Property and Casualty Insurance Company and AXA Corporate Solutions Lloyds Insurance Company of Texas). The ratings recognize the gradual restoration of AXACS's consolidated capitalization and forecast continued improvement in prospective operating performance after consideration of the restructuring measures implemented to date. The negative outlook reflects the continued challenges associated with completing the current restructuring programme and AXACS's ability to fully capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the current hardening hardening, in metallurgy, treatment of metals to increase their resistance to penetration. A metal is harder when it has small grains, which result when the metal is cooled rapidly. environment. It also factors some uncertainty regarding the prospective role of each subsidiary within the new group structure. Gradual restoration of consolidated capital base--Reduction of AXACS's consolidated risk exposure and a capital injection from its parent in September 2002 has helped to restore AXACS's risk-adjusted capital and confirmed the parental commitment to the operations. A.M. Best expects the benefits of the revised strategy and restructuring exercise to be fully reflected in 2003. Improving consolidated operating performance--Benefiting from a hard market and from the introduction of a strict risk reduction program, AXACS has improved its financial performance after a consolidated net loss of EUR EUR In currencies, this is the abbreviation for the Euro. 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. 227 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. 201 million) in 2001. Investment returns are expected to remain low, but technical results are forecast to benefit from a stricter, more 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, a more focused strategy and enhanced market conditions. Challenges associated with restructuring exercise--After the strategic separation into three distinct operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon (reinsurance, direct and run-off management) to respond to market dynamics and to maximize profitability, AXACS's management is enduring the strain of internal reorganization while trying to fully communicate the new strategy to third parties. A.M. Best continues to closely monitor developments within AXACS as the company's revised strategy unfolds, specifically with regard to the impact that these developments may have on the outlook for the company. These developments will be monitored on a quarterly basis. The financial strength ratings of A (Excellent) of the following companies have been affirmed. The outlook is negative. - AXA Re, France - AXA Corporate Solutions Assurance, France - SPS Reassurance, France - CGRM (Compagnie Generale Re Monte Carlo), Monaco - AXA Re Asia Pacific Pte Ltd., Singapore 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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