S&P downgrades Copenhagen Re to single A-minus

LONDON - Standard & Poor's has lowered its counterparty credit and insurer financial strength ratings on Copenhagen Re (Cop Re) to single-A-minus from single-A. The outlook is negative for the reinsurer, which is a subsidiary of Alm Brand mutual. S&P said Copenhagen Re's operating performance had been very poor over the last three years with its combined ratio averaging 123% over the years 1998-2000. The agency put poor performance down to greater inherent volatility in the group's book of business, which is skewed towards property risks, and specific problems relating to the underwriting parts of the London market's marine and property facultative books during 1997-99. Standard & Poor's expects operating performance to deteriorate further in 2001 due to five large losses hitting the group's London based property facultative book as well as a share of the Petrobras loss from the sinking of an oil rig in March.