Fitch Downgrades Scottish Re's Ratings; Remain on Watch Negative.CHICAGO -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has downgraded Scottish Re Group Ltd.'s (NYSE NYSE See: New York Stock Exchange :SCT Sacrococcygeal teratoma (SCT) A tumor occurring at the base of the fetus's tailbone. Mentioned in: Prenatal Surgery ) ratings as follows: Scottish Re Group Ltd. --Issuer default rating (IDR IDR In currencies, this is the abbreviation for the Indonesian Rupiah. 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. ) to ' BB' from 'BBB-'. Operating subsidiaries: --Insurer financial strength (IFS) to 'BBB' from 'BBB+'. All ratings remain on Rating Watch Negative. (See the complete listing of all ratings the bottom of this page.) The ratings action follows an update of SCT's liquidity and collateral position, which now appears tighter than Fitch had previously anticipated. At this date, Fitch does not believe that SCT has sufficient liquidity, without concessions from its bank group, to fund the repayment of the $115 million in convertible notes in December 2006. Since Fitch's most recent rating action on Aug. 1, 2006, SCT's primary operating subsidiary, Scottish Annuity & Life Insurance (Cayman) Ltd. (SALIC), has drawn down $265 million in funds under the Stingray stingray: see ray. stingray or whip-tailed ray Any of various species (family Dasyatidae) of rays noted for their slender, whiplike tail with barbed, usually venomous spines. Investor Trust liquidity facility both to confirm the availability of this source and for use in unwinding existing funding agreements with rating triggers. SALIC is also pursuing other liquidity sources, including surplus relief transactions. At this date the liquidity and collateral position at SALIC appears solid through March 31, 2007. A key issue now is the considerable uncertainty surrounding SALIC's ability to dividend funds to SCT or access credit available under its bank facilities (to which SCT is not a party). While SALIC is attempting to resolve the issue with the bank syndicate, SCT is pursuing its own avenues to raise capital and is engaged in finding a buyer for the company. While Fitch believes the actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin appraisal will indicate significant value in the underlying business, the timing of a potential sale as well as any other the other actions being pursued by the company is uncertain. As such the ratings could be lowered further and remain on Rating Watch Negative. The following ratings remain on Rating Watch Negative: Scottish Annuity & Life Insurance Company (Cayman) Limited --IFS downgraded to 'BBB' from 'BBB+'. Scottish Re (U.S.) Inc. --IFS downgraded to 'BBB' from 'BBB+'. Scottish Re Limited --IFS downgraded to 'BBB' from 'BBB+'. Scottish Re Group Limited --IDR downgraded to 'BB' from 'BBB-'; --4.5% US$115 million senior convertible notes downgraded to 'BB-' from 'BB+; --5.875% US$142 million hybrid capital units downgraded to 'B+' from 'BB'; --7.25% US$125 million non-cumulative perpetual preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. downgraded to 'B+' from 'BB'. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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