These rating actions follow Munich Re's release of earnings for the first six months of 2003. Munich Re has reported an improvement of its non-life underwriting performance, but A.M. Best believes that earnings for the full year 2003 will be below expectations. Munich Re has reported a half year loss of EUR 603 million (USD 663 million) after a EUR 1.4 billion (USD 1.54 billion) tax provision.
Munich Re still holds a superior business position as the world's largest reinsurer benefiting from its outstanding global network and underwriting capacity.
The financial strength ratings have been downgraded to A+ (Superior) from A++ (Superior) of the following companies:
-- Muenchener Rueckversicherungs
-- Munich Reinsurance Company of Australasia Ltd
-- Great Lakes Reinsurance (UK) PLC
-- Munich Reinsurance Italy S.p.A.
-- New Reinsurance Company
-- Munich Reinsurance Company of Africa Ltd
-- Munich Reinsurance Company of Canada
-- Munich American Reassurance Company
The following debt rating has been downgraded to "aa" from "aa+". The outlook has been changed to stable from negative.
-- Muenchener Rueckversicherungs
-- EUR 1.15 billion 1.0% senior unsecured convertible Eurobonds,
due June 2005
The following debt rating has been downgraded to "a+" from "aa", and the outlook has been changed to stable from negative. This rating has been changed to align with the revised notching established and presented in A.M. Best's revised debt rating criteria issued July 17, 2003.
-- Munich Re Finance B.V.
-- EUR 3 billion 6.75% subordinated Eurobonds, due June 2023
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.
CONTACT: A.M. Best Co., Oldwick
Public Relations:
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Striegel, 908-439-2200, ext. 5378
rachelle.striegel@ambest.com
or
Analysts:
Michael Zboron, +(44) 20 7626 6264
michael.zboron@ambest.com
or
Jose Sanchez-Crespo, +(44) 20 7626 6264
jose.sanchez-crespo@ambest.com