Fitch Ratings Affirms RGA; Rating Outlook Stable.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 affirmed 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. Group of America, Inc.'s (RGA RGA Reinsurance Group of America RGA Return Goods Authorization RGA Republican Governors Association RGA Residual Gas Analyzer RGA Royal Garrison Artillery RGA Restricted Growth Association (UK) RGA Rate Gyro Assembly , Inc.) issuer default rating at 'A+' and the ratings of all the company's outstanding debt (as listed below). Fitch has also affirmed RGA Reinsurance Company's (RGA Re) 'AA-' insurer financial strength (IFS) rating. The Rating Outlook is Stable. The ratings action impacts $757 million in debt and capital securities outstanding. RGA, Inc.'s ratings reflect the company's well-established and successful North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. traditional life reinsurance operations with approximately 17% of ordinary life reinsurance assumed in the United States. Ratings strengths include RGA, Inc.'s underwriting expertise and facultative focus, sound risk-based capitalization, good investment performance, liquid investment portfolio and earnings diversification through nontraditional product offerings. Rating concerns include RGA Inc.'s reliance on the continuing availability of affordable retrocession RETROCESSION, civil law. When the assignee of heritable rights conveys his rights back to the cedent, it is called a retrocession. Erskine, Prin. B. 3, t. 5, n. 1; Dict. do Jur. h.t. , including surplus relief, as a risk and capital management tool and reliance on the capital markets to fund internal growth and acquisitions. Historically, the company has benefited in financial flexibility through majority owner MetLife, Inc.'s (MET) participation in its capital raising activities. Since MET views the company as a strategic investment that could be sold, any potential sale would trigger a review of RGA, Inc. ratings. RGA, Inc.'s performance on continuing operations has been solid with relatively stable margins, despite increased volatility from quarter to quarter as a result of changes in retention. RGA Inc.'s maximum retention in North America of $6 million for a single life, is higher than many of its peers. The impact was demonstrated in the second quarter of 2005, when the volume of large claims was $30 million higher than the prior-year comparable quarter, even though the number of claims was at expected levels. Pro forma equity-adjusted leverage was 17.3% at Dec. 31, 2005, and was within Fitch's ratings expectations. GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). to fixed charges was solid but declined to 9.3 times (x) for 2005. Fitch expects RGA Re's risk-based capital to remain in the range of the 317% recorded at year-end 2005. RGA Inc. had approximately $1.7 trillion of worldwide life reinsurance in force and assets of $16.2 billion at Dec. 31, 2005. The company reported net income of $69 million through three months ending March 31, 2006. Reinsurance Group of America, Inc. --Issuer default rating 'A+'; --6.75% senior notes due Dec. 15, 2011 affirmed at 'A'; --6.75% million junior unsubordinated debentures due Feb. 15, 2065 affirmed at 'A-'. RGA Capital Trust I --Convertible trust preferred securities (PIERS) affirmed at 'A-'. RGA Reinsurance Company (The) --Insurer financial strength 'AA-'. 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. The issuer did not participate in the rating process other than through the medium of its public disclosure. |
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