Moody's & S&P React To ACE IPO

By Mark E. Ruquet

NU Online News Service, Dec. 3, 11:37 a.m.EST?The decision by ACE, Ltd., to pursue an initial publicoffering of its financial guaranty business drew a mixed reactionfrom two rating services.

New York City-based Standard & Poor's said the Hamilton,Bermuda-based ACE plan would not "have an immediate effect on theratings of ACE member companies or financial guarantysubsidiaries.[@@]

S&P rates ACE, Ltd., at "triple-B-plus/negative/A-two."

Moody's, also based in New York, changed its rating on ACEGuaranty and Capital Re Group of companies from stable todeveloping.

Ratings were also changed for ACE Capital Re Overseas, Ltd., ACECapital Re Overseas, Ltd., ACE Capital Mortgage Reinsurance Companyand ACE Capital Title Reinsurance Company, to developing. TheMoody's analysis added that the rating outlook for ACE, Ltd., andits other subsidiaries remains stable.

The rating agency said that it was too soon to tell how the IPOwould affect the involved entities.

Moody's places the carrier's Insurance Financial Strength Ratingfor ACE, Ltd., at "A-three (senior unsecured)."

As reported yesterday, Fitch Ratings gave a favorable outlook tothe IPO.

ACE said it plans to complete the IPO in the first half of2004.