Fitch Ratings Affs Stewart Title Group Rtgs; Rtg Outlook Stable.Business Editors CHICAGO--(BUSINESS WIRE)--Feb. 6, 2002 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 the 'A+' insurer financial strength ratings of Stewart Title Guaranty Company and its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. Stewart Title Insurance Company (collectively referred to as Stewart). The companies are ultimately owned by Stewart Information Services See Information Systems. Corporation (NYSE NYSE See: New York Stock Exchange :STC STC Supplemental Type Certificate (FAA) STC Society for Technical Communication STC Subject to Change STC Surf the Channel (website) STC Sound Transmission Class STC Singapore Turf Club ), a NYSE listed company. The Rating Outlook is Stable. The ratings reflect Stewart's strong capital position as measured by Fitch's risk adjusted capital (RAC See remote access concentrator. ) ratio, high quality and very liquid investment portfolio, minimal debt leverage, and conservative reserving practices. Additionally, the ratings take into account the company's low operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. , reasonable agency monitoring and auditing controls, and good market positioning as a national title insurer. The ratings also consider that the company's profitability has not met Fitch's expectations. The company's historical position as a leader in technology was anticipated to translate into enhanced profitability over time. To date, Fitch has not seen these technology related financial benefits. Fitch has noted the company's profitability in 2001 will likely be the best in Stewart's history, though Fitch believes the primary driver is favorable market conditions. For the current ratings, Fitch expects profitability to be among the best in the industry, and will continue to monitor Stewart's operating results to assess the company's ability to meet these expectations. Fitch considers Stewart's capital position to be strong and a primary factor supporting the current ratings. In 2000, absolute capital grew to $199 million from $198 million in 1999. As of year-end 2000, Stewart's RAC ratio was 223% compared to an average RAC ratio of 169% for the five national title groups. Going forward, Fitch expects Stewart to maintain similar balance sheet strength. Stewart is one of the nation's largest title insurance groups with a national market share of just over 10% in 2000 (according to ALTA). Over half of Stewart's premiums come from its five largest states: Texas, California, 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 , Florida, and Colorado. Stewart distributes its products through more than 5,800 locations on properties located in all 50 states and several foreign countries. Close to 27% of its business comes from its affiliated agencies. Entity/Issue/Type Action Rating/Outlook Stewart Title Guaranty -- Insurer financial strength Affirmed 'A+'/Stable. Stewart Title Insurance Company -- Insurer financial strength Affirmed 'A+'/Stable. |
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