Moody's Investors Service has placed the A1 insurance financial strength rating of Renaissance Reinsurance and the debt ratings of RenaissanceRe (senior unsecured at A3) and its affiliates on review for possible downgrade.
The rating review is prompted by concerns stemming from the company's disclosure that chairman and chief executive James Stanard had received a Wells notice from the SEC in connection with its ongoing investigations into the restatement of the company's financial statements.
On 11 July Michael Cash, former senior vice president and head of specialty reinsurance, resigned after refusing to cooperate with the SEC.
According to the rating agency, the review will focus on the developments and potential outcomes of the ongoing regulatory investigations including the possible negative impact on RenaissanceRe's management team, business franchise and financial position.
Earnings weakness, an elevated risk appetite, or a
reduction of equity capital of greater than 15% could also pressure the ratings.
Favourable resolution of the regulatory investigations for the company and its senior executives without further senior management departures, combined with improved earnings performance, is likely to result in a confirmation of the existing ratings.