S&P withdraws AA- rating to Gulf Insurance

S&P withdraws AA- rating to Gulf Insurance
Our Banking Bureau
15 July 2002

Dubai: Following the restructuring activities at Gulf Insurance group, a wholly owned subsidiary of Travelers Property Casualty Corp, a Citigroup arm, Standard & Poors (S&P) has withdrawn its AA- counter-party credit and financial strength ratings on Gulf Insurance Co UK (Gulf UK).

The ratings had been placed on CreditWatch with negative implications on 12 March 2002 based on the companys earlier exclusion from the Travelers Property Casualty Pool.

Gulf UK is a London-based property and casualty company. As of 31 March 2002 the entity had reported a year-to-date net income of $1.5 million and had a capital and surplus account totalling $24.8 million.

In May 2002 the group announced $125-million investment by Trident II LP, a private equity fund managed by MMC Capital specialising in making investments in insurance, reinsurance and financial services sectors.

Gulf UK could quickly evolve into a new organisation, and any prospective rating would have to be based on a review of a detailed business plan and new support agreements, says S&P credit analyst Michael Gross.