A.M. Best Revises St. Paul Companies' Under Review Implications.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 26, 2004 A.M. Best Co. has revised the implications of its review of The St. Paul St. Paul as a missionary he fearlessly confronts the “perils of waters, of robbers, in the city, in the wilderness.” [N.T.: II Cor. 11:26] See : Bravery Companies, Inc.'s (St. Paul) (NYSE NYSE See: New York Stock Exchange : SPC 1. (business) SPC - Statistical Process Control. Something to do with quality management. 2. (body) SPC - Software Productivity Centre. 3. (company) SPC - Software Publishing Corporation. 4. ) (St. Paul, MN) financial strength and debt ratings from positive to developing. This rating action follows St. Paul's
adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charge in the fourth quarter to increase reserves for its health care business, which is in run-off run-off n (in contest, election) → desempate m (= extra race); carrera de desempate run-off n (in contest, election) → . This charge exceeds management's previous estimate of potential health care reserve deficiency reserve deficiency A shortage in funds set aside as a reserve for a specific purpose. For example, during a recession a firm may find the reserve fund covering allowance for bad debts deficient when the amount of bad debts exceeds expectations. of $250 million pretax. On November 17, 2003, A.M. Best placed the financial strength and debt ratings of St. Paul under review with positive implications following its announcement that it would merge with Travelers Property Casualty Corp. (Travelers) (NYSE: TAP.A and TAP.B) (Hartford, CT). The positive rating implications on St. Paul reflected the proposed merging with a higher-rated organization that is less financially and operationally leveraged. A.M. Best's revision to the implications of St. Paul's ratings review reflects its recent reserve charge, which has resulted in weaker than anticipated, although still strong, capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. . Consequently, the likelihood of any positive rating actions on St. Paul's ratings after the close of the proposed merger with Travelers has been reduced, since both St. Paul and Travelers will continue to be pooled and rated separately. Nevertheless, the group is still expected to benefit from this merger. In addition, while A.M. Best considered potential health care reserve charges in the evaluation of St. Paul's capitalization and the assignment of the current ratings, the fourth quarter 2003 charge highlights the uncertainty associated with the run-off; lessens A.M. Best's view of St. Paul's overall capitalization and its ability to absorb additional charges in the future; and reflects adversely on A.M. Best's view of the company's operating performance. A.M. Best's review of St. Paul's ratings will focus on its earnings capability and balance sheet strength, including the adequacy of its reserves for its core and run-off businesses. A.M. Best expects to conclude its review upon the close of St. Paul's proposed merger with Travelers, which is expected to occur in the second quarter of 2004. For a comprehensive list of St. Paul Companies' financial strength and debt ratings, please visit www.ambest.com/press/012601stpaul.pdf. For a complete 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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