A.M. Best Assigns Ratings to PARIS RE S.A. and PARIS RE Holdings Limited; Downgrades Ratings of CGRM.OLDWICK, N.J. -- A.M. Best Co. has assigned a financial strength rating (FSR (Free System Resource) In Windows 3.x, the amount of unused memory in various 64K blocks reserved for managing current applications. Every open window takes some space in this area. See Windows memory limitation. ) of A- (Excellent) and an issuer credit rating (ICR (Intelligent Character Recognition or Image Character Recognition) The machine recognition of hand-printed characters as well as machine printing that is difficult to recognize. ) of "a-" to PARIS Paris, in Greek mythology Paris or Alexander, in Greek mythology, son of Priam and Hecuba and brother of Hector. Because it was prophesied that he would cause the destruction of Troy, Paris was abandoned on Mt. RE S.A. (PARIS RE) (France), the main operating company operating company A business that engages in transactions with outsiders. of the newly formed PARIS RE group. Concurrently A.M. Best has assigned an ICR of "bbb-" to PARIS RE Holdings Limited (Switzerland), the ultimate parent company of PARIS RE. A.M. Best has also assigned an FSR of A- (Excellent) and an ICR of "a-" to PARIS RE Switzerland AG and PARIS RE Bermuda Limited, both subsidiaries of PARIS RE Holdings Limited. In addition, A.M. Best has downgraded the FSR to A- (Excellent) from A (Excellent) and the ICR to "a-" from "a" of CGRM CGRM Computer Graphics Reference Model (ISO) (Compagnie Generale de Reassurance de Monte Carlo Monte Carlo (môNtā` kärlō`), town (1982 pop. 13,150), principality of Monaco, on the Mediterranean Sea and the French Riviera. ), and affirmed the FSR of A- (Excellent) and assigned an ICR of "a-" to PARIS RE America Insurance Company (previously named 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 Re America Insurance Company) (New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , NY). Both companies are subsidiaries of PARIS RE. The outlook for all ratings is stable. The ratings of PARIS RE reflect its strong initial capitalisation and an experienced management team. An offsetting factor is the challenging market environment in which PARIS RE operates. PARIS RE was established by private equity funds to continue the 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. activity of AXA RE, with an initial consolidated 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. 1.65 billion of tangible capital. Funds include Trident III, exclusively focused in insurance business, which is managed by Stone Point. Other main shareholders include Hellmann and Friedmann, Vestar Capital and Crestview. As part of the transaction, PARIS RE is 100% reinsuring the portfolio of AXA Re, which will continue to front the ceded risks until 30 September 2007. The transaction became retroactively effective as of 1 January 2006. Consequently, PARIS RE has already benefited from excellent earnings in 2006: USD 437 million, of which approximately USD 230 million is related to the insurance activity and remainder from the positive gain on acquisition (badwill). Technical reserves prior to 31 December 2005 are fully guaranteed by AXA and AXA RE, while PARIS RE is benefiting from the investment income associated to assets backing guaranteed reserves until these reserves are fully run off. In A.M. Best's view, PARIS RE has retained an experienced senior management team from AXA RE, led by Peter Gerhardt, and an existing infrastructure operation including back office. A.M. Best believes that PARIS RE will be challenged by increased competition and additional capacity from established and newly created companies. In addition, AXA Re's historic operational performance was volatile. Given these factors, PARIS RE may find it difficult to achieve its business plans and earnings targets. A.M. Best will closely monitor the performance of PARIS RE against its business plan. The ratings of PARIS RE Switzerland AG and PARIS RE Bermuda Limited also factor a rating enhancement for its strategic role within the PARIS RE group. A.M. Best expects that PARIS RE Switzerland AG will have put into place a level of capitalization in line with the rating by the end of third quarter 2007. The downgrade of CGRM's ratings and the affirmation of PARIS RE America Insurance Company's ratings reflect the change in ownership (previously AXA Re) but also factor into the rating an implicit support from the new parent company. Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors. For more information, visit www.ambest.com. |
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