Standard & Poor's Ratings Services said German property-casualty insurer Allianz Marine & Aviation Versicherungs AG (AMAG) and French property-casualty insurer Allianz Marine & Aviation (France) S.A. (AMAF) will remain on watch with positive implications.
The long-term counterparty credit and financial strength ratings on both entities were placed on watch Nov. 22, 2005.
The action was taken after Allianz AG said it planned to merge the Germany-based group's internal reinsurer for industrial business, Allianz Global Risks, and the industrial business written by the German nonlife operations of the Allianz group, into AMAG.
The credit watch placement will be resolved after the merger is completed, the rating agency said. The action is expected, at the latest, by the end of August, S&P added.
S&P said it would most likely increase the rating of the two after an analysis of the merger, provided the mergers are successful.
"Standard & Poor's needs to determine whether the new AMAG and industrial business in general are core or strategically important to [Allianz Risk Group]," said Karin Clemens, S&P's credit analyst. "The ratings on AMAG and AMAF could be raised by two or three notches depending on Standard & Poor's assessment of the entities' future group status."
All four groups are rated "A-minus/watch-positive."
S&P said it would update the placement after further discussions with management and remove the ratings from watch after the restructuring takes place.
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