A.M. Best Affirms Ratings of SCOR and Its Core Subsidiaries.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--April 1, 2004 A.M. Best Co. has affirmed the financial strength rating of B++ (Very Good) of SCOR SCOR Scientific Committee on Oceanic Research SCOR Supply Chain Operations Reference model SCOR Small Corporate Offering Registration SCOR Specialized Center of Research (White Plains, NY) SCOR Second Cousin Once Removed (Paris) and its core subsidiaries and the ratings on debt instruments issued or guaranteed by SCOR. (See link below for a full list of financial strength and debt ratings). This action removes the under review status of the ratings assigned on September 10, 2003. The outlook for all ratings is stable. The rating reflects SCOR's very good prospective capitalisation, improving trends in underlying performance, actions taken to mitigate the risks associated with Commercial Risks Partners Limited (CRP C-reactive protein (CRP) A protein present in blood serum in various abnormal states, like inflammation. Mentioned in: Pelvic Inflammatory Disease CRP, n.pr See C-reactive protein. ) (Bermuda) and the company's credit derivatives Credit Derivative Privately held negotiable bilateral contracts that allow users to manage their exposure to credit risk. Credit derivatives are financial assets like forward contracts, swaps, and options for which the price is driven by the credit risk of economic agents (private portfolio, as well as strong support from its core clients in continental European markets. Offsetting factors are recent volatility in reserves and the impact that the company's recent performance has had on its profile in certain markets. Very good prospective capitalisation--A.M. Best expects SCOR to maintain risk-adjusted capitalisation at a very good level in 2004, following completion of its 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. 750 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. 949 million) rights issue in January 2004. Stability in the company's risk-adjusted capitalisation will be further supported by an anticipated reduction in net premiums written of approximately 20% to less than EUR 2,750 million (USD 3,384 million) in 2004. Improving underlying performance--SCOR has re-established profitability in its main non-life lines (excluding the impact of discontinued and non-core lines) and has maintained the profitability of its life 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. business. Reserve deterioration of EUR 297 million (USD 344 million) in the third quarter of 2003 resulted from SCOR's steps to re-establish reserves at the best estimate level advised by external actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin consultants. With the impact of these legacy issues likely to reduce in 2004, A.M. Best believes SCOR's performance is likely to improve. Risk mitigation--SCOR has taken effective action to address certain key areas of risk to the company. A reduction in CRP's reserves of approximately 60% was recorded at year-end 2003 relative to the position a year earlier, incorporating commutations with two major clients in the course of the year. To address risk from the company's credit derivatives portfolio, the company has entered into an agreement that hedges its credit exposure. Support from core clients--A.M. Best believes that SCOR continues to have a very good profile in its core markets in continental Europe Continental Europe, also referred to as mainland Europe or simply the Continent, is the continent of Europe, explicitly excluding European islands and, at times, peninsulas. and Asia. Poor performance in 2002 and 2003 has had some impact on its prospects in certain markets, particularly the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and the United Kingdom, although A.M. Best believes the EUR 750 million (USD 949 million) rights issue has helped to restore confidence. For a complete list of SCOR's financial strength and debt ratings, please visit www.ambest.com/press/040101scor.pdf. For a list of A.M. Best's debt ratings, please visit http://www3.ambest.com/debtratings/. 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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