EUROPEAN CREDIT INSURERS NOW MORE RESILIENT, SAYS MOODY'S

European credit insurers are in a better position now to cope with any new credit crisis than they were in 2008, according to rating agency Moody's. However, a relaxation of underwriting discipline over the past couple of years and constrained earnings mean that those insurers would find it harder to rebound than they did after 2008. Moody's estimated that a repeat of the 2008 crisis would see credit insurers lose between 5% and 10% of shareholders' equity after tax, compared with a 20% loss after the 2008 crisis. However, Moody's warned that, were a crisis to occur, the credit insurers "would not have the ability to cancel limits or increase prices to the same extent as during the previous crisis", because that would be very damaging for the credit insurers' commercial relationship with their customers.