Standard & Poor's (S&P) has lowered the long-term counterparty credit and insurer financial strength ratings of Converium Reinsurance (North America) from A- to BB+.
The ratings for Switzerland-based Converium AG and its main operating subsidiaries remain on CreditWatch where they were placed on 20 July 2004.
“The rating action follows the announcement by the Converium Group that it plans to place CRNA into run-off,” said S&P credit analyst Rob Jones.
While CRNA was previously considered core to its parent, and was therefore rated at the same level as Converium's other operating subsidiaries, S&P now considers CRNA to be nonstrategic, and the company is therefore rated on a stand-alone basis, said the ratings agency.
The ratings on the Converium group entities were lowered and placed on CreditWatch on 20 July 2004, following the announcement of the need for reserve strengthening and the initiation of the Tillinghast review.
This caused S&P to negatively reassess the group's operating performance, its capital adequacy, and the credibility of management, it said.
The CreditWatch placement of CRNA will be resolved following a detailed review of its stand-alone reserves and capital adequacy.
