Ratings Roundup: Blue Fin (Allianz), Generali, Greenlight Re, Eureko
Standard & Poor’s Ratings Services has assigned its ‘BB+’ long-term senior secured debt ratings to each of the following notes issued by Blue Fin Ltd. under Allianz SE’s (rated ‘AA’/ Stable/ A-1+) newly established windstorm catastrophe bond shelf program:
— €155,000,000 [$227.7 million] Series 1 Class A Principal At-Risk Floating-Rate Notes due April 10, 2012;
— $65,000,000 Series 1 Class B Principal At-Risk Floating-Rate Notes due April 10, 2012.
These are the first issuance under the newly established €1 billion principal at-risk floating-rate note program. The transaction closed on Nov. 7, 2007, at which time ratings were assigned to the floating-rate notes. “Blue Fin is a special-purpose Cayman Islands-exempted company whose ordinary shares are held in charitable trust,” S&P explained. “It issued the notes and invested the proceeds in high-quality assets within a collateral account. Blue Fin swaps the total return of the asset portfolio with Morgan Stanley Capital Services Inc., in exchange for quarterly EURIBOR and LIBOR based payments. Simultaneous to the issuance of the notes, Blue Fin entered into an International Swaps and Derivatives Association (ISDA)-based counterparty contract comparable with a reinsurance contract with Allianz Argos 14 GmbH, guaranteed by Allianz. This contract will provide for payments to Allianz if a windstorm of a certain magnitude occurs within predefined European countries.”
Standard & Poor’s Ratings Services said that its counterparty credit and insurer financial strength ratings and outlook on the core operating companies of Italian insurer Generali Group (insurer financial strength rating ‘AA’/Stable) remain unchanged following its announcement of its proposed acquisition of Swiss bank Banca del Gottardo (not rated). “The financing of this acquisition will be finalized only in 2008, but we expect it to have a neutral effect on the group’s capitalization,” said S&P. “Capitalization had in effect already weakened, albeit to a level still in line with the ratings, as a consequence of the share buyback program and the 51 percent stake Generali has agreed to buy in the joint venture with PPF Group N.V. The ratings on Generali remain based on its very strong competitive position and earnings.”
A.M. Best Co. has affirmed the financial strength rating (FSR) of ‘A-‘ (Excellent) and the issuer credit rating (ICR) of “a-” of Cayman Islands-based Greenlight Reinsurance Ltd. Best also assigned an ICR of “bbb-” to Greenlight Re’s parent holding company, Greenlight Capital Re, Ltd., which is also based in the Cayman Islands. “The ICR of Greenlight Capital Re is strictly based on holding company methodology, since the company does not carry debt,” Best noted. The outlook for all ratings is stable.
“The ratings of Greenlight Re are based on its excellent risk-adjusted capitalization, experienced management team and the disciplined implementation of its business plan. The ratings also recognize the company’ s enhanced balance sheet strength following the successful initial public offering (IPO) on May 30, 2007 of Greenlight Capital Re,” said Best.
Standard & Poor’s Ratings Services has revised its outlook on the holding companies and core operating entities of Netherlands-based insurance group Eureko to stable from positive. S&P also affirmed its ‘A+’ long-term counterparty credit and insurer financial strength ratings on Eureko’s core operating entities, its ‘A-‘ long-term counterparty credit and senior unsecured debt ratings on Eureko’s holding companies–Eureko B.V. and Achmea Holding N.V.–and its ‘A-2’ short-term counterparty credit rating on Achmea Holding.
“The outlook revision reflects the delayed emergence of improved profitability across the group, in particular in the Dutch pensions business,” said S&P. “”The ratings reflect Eureko’s successful integration of Interpolis BTL N.V. and N.V. Interpolis Schade, very strong capitalization, and strong competitive position,” added credit analyst Paul Bradley.