A.M. Best Lowers Ratings of Several Core Subsidiaries of the Gerling Group.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--March 15, 2002 A.M. Best Co. has lowered the financial strength rating of the rated core 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. of the Gerling Gerling are an alternative guitar and electronic act from Australia. They formed in 1993, and are based in Sydney. History The band formed in 1993 with the line-up of Darren Cross (guitar, vocals), Presser (real name Paul Towner, drums) and Brad Herdson (guitar, vocals). Group (see list below) to A- (Excellent) from A (Excellent). At the same time, A.M. Best has downgraded the rating on the subordinated debt Subordinated Debt A loan (or security) that ranks below other loans (or securities) with regard to claims on assets or earnings. Also known as "junior security" or "subordinated loan". issued by Gerling Global Finance Alpha B.V., and guaranteed by Gerling-Konzern Globale Rueckversicherungs-Aktiengesellshaft (Gerling Global Re), to "bbb" from "a". These ratings are maintained under review. However, the implications of the under review status have been changed from developing to negative. These rating actions reflect a significant deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in the operating performance of Gerling Globale Re, the largest operating company operating company A business that engages in transactions with outsiders. in the group, changes in senior management and a substantial erosion of the group's capital base, despite the recent 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. 300 million capital contribution. The EUR500 million loss reported on March 13, 2002, by Gerling Global Re exceeded A.M. Best's expectations for 2001. The under review with negative implication status highlights A.M. Best's concerns about potential adverse earnings developments, which could further constrain con·strain tr.v. con·strained, con·strain·ing, con·strains 1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force. 2. the group's financial flexibility over the near-term. A.M. Best continues to closely monitor developments at the Gerling group, speculation about the group's future and the progress of any corrective actions A corrective action is a change implemented to address a weakness identified in a management system. Normally corrective actions are instigated in response to a customer complaint, abnormal levels if internal nonconformity, nonconformities identified during an internal audit or introduced by the new management team at 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. company. The following financial strength rating has been lowered to A- (Excellent) under review with negative implications, from A (Excellent) under review:
- Gerling-Konzern Allgemeine Versicherungs-AG
- Gerling-Konzern Globale Rueckversicherungs-AG
- Gerling Global Reinsurance Company of Australia Pty. Ltd.
- Gerling Global Life Reinsurance Company of Australia Pty. Ltd.
- Gerling Global International Reinsurance Company Ltd.
- Gerling Global Reinsurance Company
- Gerling Global Life Insurance Company
- Gerling Canada Insurance Company
- Gerling Global Reinsurance Company of South Africa Ltd.
- Gerling Global Sweden Reinsurance Company
- Gerling Globale Rueckversicherung AG.
- Gerling Global General and Reinsurance Company Ltd.
- Gerling Global Life Reassurance Company (UK) Ltd.
- Gerling Global Life Reinsurance Company
- Gerling Global Reinsurance Corporation of America
- Constitution Insurance Corporation
The following financial strength ratings have been affirmed and
placed under review with negative implications:
- Gerling America Insurance Company A-
- Gerling Global Reinsurance Corporation (United States Branch) B+
The following debt rating has been lowered and remains under
review with negative implications:
- Gerling Global Finance Alpha B.V.--
-- "bbb" rating on EUR220 million 6.625% Guaranteed
Subordinated Step-up Fixed/Floating Rate Bonds, due
2021
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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