S&P Puts GE Units On Watch
NU Online News Service, Dec. 21, 12:22 p.m. EST? Standard & Poor's Ratings Services said it has placed several ratings for GE insurance units on "CreditWatch" with negative implications, citing concerns about the group's continuing reserve strengthening for past accident years.[@@]
The rating agency's decision will affect "A-plus" counterparty credit and financial strength ratings on Employers Reinsurance Corp. (ERC) and the "A-minus" counterparty credit rating on GE Insurance Solutions Corp., as well as various ratings on several of their affiliates.
"These rating actions stem from our ongoing concerns about the group's continuing reserve strengthening for past accident years," S&P credit analyst Laline Carvalho explained.
Ms. Carvalho said S&P expects to resolve the "CreditWatch" status in the 2005 first quarter, following a review of year-end 2004 statutory financials. She added that although a definitive conclusion cannot be established before then, S&P still believes ratings would not change by more than two notches.
Ms. Carvalho noted that the current ratings on ERC and GE Insurance Solutions reflect the company's strong global reinsurance franchise, moderately improving operating performance and conservative investment portfolio.
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