Converium comments on Standard & Poor's rating decision and announces the placing into run-off of its US operations

Friday, 10. September 2004 20:25

Converium to consider changes to its global business plan

Converium is disappointed with Standard & Poor's decision to lower
the Company's ratings to BBB from A-. Converium, however, will make
all efforts to maintain its franchise. Today's rating action by
Standard & Poor's, in conjunction with A.M. Best's recent downgrading
of Converium, has required changes to the Company's global business
plan which will be communicated shortly. As a consequence of the
rating action taken by Standard & Poor's, Converium is reviewing all
options with its banks concerning the proposed share issue announced
on September 3, 2004.

Converium to place its US operations into run-off

In the wake of A.M. Best's recent downgrading of Converium to B++ the
Company will not inject any additional capital into Converium
Insurance (North America) Inc. (CINA) as originally planned. The
proceeds from Converium's proposed capital raising will be used to
strengthen the capitalization of Converium AG, Zurich, and Converium
Rückversicherung AG (Deutschland), Cologne, in order to protect the
Company's franchise outside the US. The Company will therefore place
its US operations into run-off, i.e. no longer write reinsurance from
the US. Converium intends, however, to continue underwriting US
exposure from Converium AG, Zurich, and its Bermuda Branch. In this
context, Converium is currently discussing fronting arrangements with
third parties for the existing Global Aerospace Underwriting Managers
Ltd. (GAUM) business written by CINA. Converium is committed to
ensure an orderly run-off of the reserves that the Company carries in
its North American legal entities and will continue to negotiate
commutations and to conduct claims and underwriting audits.

Resignation of Gary Prestia

As a result of these developments Gary Prestia, member of Converium's
Global Executive Committee and Chief Technical Officer, has submitted
his resignation as president of Converium Reinsurance (North America)
Inc. (CRNA). Converium regrets his decision to leave the Company and
thanks Mr. Prestia for his valuable contribution to the Company. His
successor will be Corcoran Byrne, currently General Counsel of CRNA.

* * * * * * *

Dr Kai-Uwe Schanz
Chief Communication Officer
Phone: +41 (0) 1 639 90 35
Fax: +41 (0) 1 639 70 35

Zuzana Drozd
Head of Investor Relations
Phone: +41 (0) 1 639 91 20
Fax: +41 (0) 1 639 71 20

About Converium

Converium is an independent leading global multi-line reinsurer known
for its innovation, professionalism and service. Today Converium
ranks among the top ten professional reinsurers and employs
approximately 850 people in 23 offices around the globe. Converium
is organized into three business segments: Standard Property &
Casualty Reinsurance, Specialty Lines and Life & Health Reinsurance.
Converium's net losses for the September 11, 2001 terrorist attacks
in the United States are capped at US$ 289.2 million by its former
parent, Zurich Financial Services. Converium has minimal A&E
exposures. Converium has a "BBB" rating (watch developing) from
Standard & Poor's and a "B++" (outlook negative) rating from A.M.
Best Company.

Important Disclaimer

This document contains forward-looking statements as defined in the
U.S. Private Securities Litigation Reform Act of 1995. It contains
forward-looking statements and information relating to the Company's
financial condition, results of operations, business, strategy and
plans, based on currently available information. These statements
are often, but not always, made through the use of words or phrases
such as 'expects', 'should continue', 'believes', 'anticipates',
'estimates' and 'intends'. The specific forward-looking statements
cover, among other matters, the reinsurance market, the outcome of
insurance regulatory reviews, the Company's operating results, the
rating environment and the prospect for improving results, the amount
of capital required and impact of its capital improvement measures,
including the restructuring of our U.S. business and its reserve
position. Such statements are inherently subject to certain risks and
uncertainties. Actual future results and trends could differ
materially from those set forth in such statements due to various
factors. Such factors include general economic conditions, including
in particular economic conditions; the frequency, severity and
development of insured loss events arising out of catastrophes, as
well as man-made disasters; the outcome of our regular quarterly
reserve review, our ability to raise capital and the success of our
capital improvement measures, the ability to obtain applicable
regulatory approval for our capital improvement measures, the ability
to exclude and to reinsure the risk of loss from terrorism;
fluctuations in interest rates; returns on and fluctuations in the
value of fixed income investments, equity investments and properties;
fluctuations in foreign currency exchange rates; rating agency
actions; changes in laws and regulations and general competitive
factors, and other risks and uncertainties, including those detailed
in the Company's filings with the U.S. Securities and Exchange
Commission and the SWX Swiss Exchange. The Company does not assume
any obligation to update any forward-looking statements, whether as a
result of new information, future events or otherwise.
Please note that the company has made it a policy not to provide any
quarterly or annual earnings guidance and it will not update any past
outlook for full year earnings. It will however provide investors
with perspective on its value drivers, its strategic initiatives and
those factors critical to understanding its business and operating
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