MOODY'S ASSIGNS "aa2" RATING TO ZURICH CAPITAL TRUST I CAPITAL SECURITES; JUNIOR SUBORDINATED DEBENTURES OF ZURICH HOLDING COMPANY OF AMERICA, INC. ARE RATED Aa3
New York, May 28, 1997 -- Moody's Investors Service has assigned an "aa2" rating to capital securities to be issued by Zurich Capital Trust I. Zurich Capital Trust I (the Trust) is a special-purpose statutory business trust sponsored by Zurich Holding Company of America, Inc. (Zurich Holdings). The securities will be guaranteed, on a limited and junior subordinated basis, by Zurich Holdings. Moody's also assigned a Aa3 rating to junior subordinated debentures to be issued by Zurich Holdings to the Trust in connection with the on-lending of proceeds from the capital securities issuance. Zurich Insurance Company, which is rated Aa1 for insurance financial strength, will guarantee, on a junior subordinated basis, the obligations of Zurich Holdings under its junior subordinated debentures, and under its limited guarantee of the capital securities. Moody's ratings on Zurich Insurance Company and on various of its affiliates, as detailed below, were also confirmed.
According to Moody's, the ratings are based on Zurich Insurance Company's strong global market position in insurance and reinsurance, its relatively stable earnings, and historically conservative capital structure. However, in recognition of the company's increasing leverage profile and sharply competitive conditions in the commercial insurance marketplace, as well as challenges associated with developing Zurich's asset management business, Moody's ratings outlook is negative.
The following ratings were assigned:
Zurich Capital Trust I - "aa2" capital securities;
Zurich Holding Company of America, Inc. - Aa3 subordinated debentures.
The following ratings were confirmed:
Zurich Insurance Company - Aa1 insurance financial strength and Aaa senior secured asset-backed securities;
Alpina Insurance Company Limited - Aa1 insurance financial strength;
Zurich Insurance (Jersey) Limited - Aa3 guaranteed subordinated debentures;
Kemper Corporation - A1 senior unsecured debt, A1 senior unsecured medium term notes, and "a1" preferred stock;
Zurich Life Insurance Company of America - Aa3 insurance financial strength;
Federal Kemper Life Assurance Company - Aa3 insurance financial strength;
Kemper Investors Life Insurance Company - Aa3 insurance financial strength,
The Aa3 insurance financial strength rating of Zurich Reinsurance Centre, Inc., and the A1 rating of senior debt of Zurich Reinsurance Centre Holdings, Inc., were confirmed and remain under review for possible upgrade, pending resolution of the planned buyout of minority owners and restructuring of that group.
Zurich Insurance Company, based in Zurich, Switzerland, is a leading global insurer with significant operations in non-life insurance, reinsurance, life insurance and asset management. For the year ended December 31, 1996, the group reported consolidated non-life net earned premiums of SF20.2 billion and capital and surplus of SF13.7 billion.
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