International ratings agency Standard & Poor's has placed its A+ financial strength and counterparty ratings on Converium on CreditWatch with negative implications.
Converium is a wholly owned subsidiary of Converium Holding, which is the newly formed holding company for the assumed reinsurance operations of Zurich Financial Services (ZFS).
S&P said the CreditWatch situation reflects the exposure of ZFS to the terrorist attacks in the US and the current uncertainty as to how “related losses arising will be apportioned between the subsidiaries that make up Converium Holding and those that make up ZFS”.
S&P said it expects the CreditWatch situation to be resolved within the next few weeks after ZFS and Converium Holding have agreed on how the ultimate claims will be shared between their subsidiaries.
Also to be assessed will be the effect of the losses on the capital adequacy of the Converium Holding entities.
