Rating agency Standard & Poor's has declared that Royal & SunAlliance (R&SA) still has some way to go before it restores its 'A' rating, despite the successful IPO of R&SA's Australasian subsidiary, Promina.
In a statement S&P said the IPO combined with R&SA's recent sale of its healthcare business has improved its capital position.
However it warned: "Nevertheless, Standard & Poor's expects R&SA to continue delivering on schedule the actions outlined on Nov. 7, 2002, in its Operating and Financial Review to improve capital adequacy to a level consistent with a rating in the 'A' range.
"R&SA is also expected to maintain its market position in its key profitable segments and post a combined ratio below 101.5% in 2003."
An S&P spokesman added: "The transaction comprises £555m in sale proceeds and £137m in intragroup debt repayments. Maintenance of the ratings on R&SA was dependent on the group successfully completing the IPO during the first half of 2003. The capital release is broadly in line with expectations."
