Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​​

I AGREE
Announcement:

Moody's Affirms Munich Re's Aa3 IFSR With a Stable Outlook

Global Credit Research - 09 Dec 2010

London, 09 December 2010 -- Moody's Investors Service has affirmed the Aa3 insurance financial strength ratings (IFSR) of Munich Reinsurance Company (Munich Re), its US non-life reinsurance subsidiary, and its primary German life insurance subsidiaries. Munich Re's debt ratings have also been affirmed. (See list below for more details.). The rating outlook is stable.

The rating affirmation reflects Munich Re's excellent business franchise, strong business diversification and capital adequacy, excellent asset quality, together with conservative management practices. These strengths are offset somewhat by the challenge of achieving its 15% cross-cycle return on risk adjusted capital (RORAC) target within a low interest rate environment, the inherent volatility of its catastrophe exposed business, and by the challenge of reserve estimation in certain long-tail lines of business.

Munich Re is one of the leading global reinsurers with a stable franchise and Moody's continues to view its reinsurance market position as excellent in both absolute and relative terms. Munich Re has a significant market share in P&C reinsurance, and the Group writes most of its business directly, frequently being the lead reinsurer on programmes. Munich Re is also one of the two leading global life reinsurers, albeit with a relatively small presence in the US market-place. This is notwithstanding the Group's desire to enhance its franchise strength in the US P&C market via increasing its broker and niche primary insurance business with recent acquisitions a feature. Via ERGO Versicherungsgruppe (ERGO), the Group is also Germany's third largest insurer with a German life market share of around 7%.

Moody's also views Munich Re's business and geographic diversification as strong. The Group writes a significant amount of generally non-correlating and less volatile Life & Health reinsurance business (38% of reinsurance GPW at YE2009), although this business is not without risk, and has meaningful primary insurance operations, accounting for around 42% of total GPW, albeit orientated towards life and health and German business (respectively c.71% and c.74% of total primary business).

Other credit strengths for the Group include excellent asset quality with a relatively low level of reinsurance recoverables and goodwill in relation to equity, and high risk assets in relation to invested assets remain below 10%. In particular, Moody's notes the Group's continued low equities exposure (only 2.6% net of hedging at Q1 10), the very good quality of the fixed-income portfolio around 75% of which is government/semi government and Pfandbriefe/Covered bonds, and a low amount of non-agency structured products. The Group's sovereign debt is orientated towards North America, Germany, UK, and France. Exposure to Greek, Irish, and Portuguese bonds, including policyholder participation, is limited to around 5% of the overall government/semi-government bond portfolio.

Capital adequacy is viewed as strong with Munich Re's YE09 economic risk capital coverage, based on the requirements of its internal risk model (175% of VaR 99.5%) improving to 153% (post dividend payment and share buy-backs) compared to 142% at YE08. Moody's also notes the considerable risk mitigation undertaken by ERGO. Nevertheless, the gross underwriting leverage metric for the reinsurance business is somewhat high at 3.1x, although the Group's gross and net natural catastrophe exposures remain within Moody's Aa parameters. Furthermore, Moody's capitalisation metrics for the Group remain inferior to those achieved before the financial crisis as does the Group's economic risk capital coverage which stood at 199% in 2007. Moody's also notes that meaningful share buy-backs and dividends have been a consistent feature of Munich Re's capital management with €10.5bn returned to shareholders from 2005-9m 2010, but this has been outweighed by net income of around €16bn in the same period.

Off-setting these strengths somewhat is the inherent volatility of the Group's catastrophe exposed business, as demonstrated by the P&C reinsurance combined ratio of 102% at 9m 2010, and the challenge for the Group of achieving its 15% cross-cycle return on risk adjusted capital (RORAC) target within a low interest rate environment. Furthermore, we believe that compensating for lower investment yield through improved underwriting results will be difficult in light of the pricing headwinds that Munich Re and other reinsurers currently face as a result of the ample capacity in the reinsurance industry. This is notwithstanding that the Group's P&C reinsurance combined ratio for 2006-9m 2010 is in line with its 97% cross-cycle target, and the recent improvement in the attritional loss ratio. We also recognize that Munich Re's ROE from 2005-2009 has averaged around a very good 12% with low volatility, and the Group has achieved RORACs of 15% and 14.5% for 2009 and 9m 2010 respectively. Overall we view Munich Re's profitability as very good as opposed to excellent.

The affirmation of the Aa3 insurance financial strength ratings on ERGO Lebensversicherung AG, (formally Hamburg-Mannheimer Versicherungs AG) and Victoria Lebensversicherung AG reflect their status as core members of ERGO Versicherungsgruppe (ERGO), the key direct insurance operations of the Munich Re group. The ratings also reflect ERGO's strong position as respectively the third and fifth largest Life and P&C player in Germany, its well-diversified product offering and its extensive distribution network. Partially offsetting these strengths, ERGO has been losing market share in recent years, although intentionally for traditional business, and the prolonged low interest rate environment is likely to continue to exert pressure on earnings. In addition there will inevitably be challenges, for example potentially higher lapse ratios at Victoria, associated with the decision to discontinue new business activity at Victoria and adapting to the new ERGO corporate structure.

Moody's also affirmed the Aa3 insurance financial strength rating of Munich Reinsurance America, Inc. (MRAm) and the A2 senior debt rating of Munich Re America Corporation (MRAC), reflecting explicit and implicit support from Munich Re and the strategic importance of the US operations within the group's global reinsurance franchise. MRAm maintains a strong position in the US reinsurance market, benefiting from long-standing client relationships developed through direct distribution of treaty and facultative reinsurance, as well as an increasing presence in the broker market channel. For the nine months ended September 30, 2010, MRAC reported GAAP net income of $165 million and a combined ratio of 98.2%.

The rating agency noted the following factors could lead to a ratings upgrade: sustained strong core earnings with ROE in the mid-teens (14-16%) over the underwriting cycle, financial leverage in the mid- to high teens (15-19%), earnings coverage of 9-14x. Conversely, the following factors could put negative pressure on the ratings: return on equity over the underwriting cycle below 12%, financial leverage consistently above 25% and earnings coverage consistently below 9x, reduction in shareholders' equity of >10% over a 12 month period due to catastrophe losses or poor operating results.

The following ratings were affirmed with a stable outlook:

Munich Reinsurance Company - Aa3 insurance financial strength rating, A2 subordinated debt rating, A3 junior subordinated debt rating

Munich Reinsurance America, Inc.- Aa3 insurance financial strength rating

Munich Re America Corporation- A2 senior debt rating

ERGO Lebensversicherung AG -- Aa3 insurance financial strength rating;

Victoria Lebensversicherung AG -- Aa3 insurance financial strength rating;

Based in Munich, Germany, Munich Re reported gross premiums written of Eur41.4 bn, equity of Eur22.3bn, and net income of Eur2.5bn as at YE09.

The date of the previous rating action was 2 July 2009 when Munich Re's ratings were affirmed with a stable outlook.

The principal methodology used in rating Munich Re was Moody's Global Rating Methodology for Reinsurers, published in July 2008 and available on www.moodys.com in the Rating Methodologies sub-directory under the Research & Ratings tab. Other methodologies and factors that may have been considered in the process of rating this issuer can also be found in the Rating Methodologies sub-directory on Moody's website.

London
Simon Harris
MD - Financial Institutions
Financial Institutions Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

London
Dominic Simpson
VP - Senior Credit Officer
Financial Institutions Group
Moody's Investors Service Ltd.
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Moody's Investors Service Ltd.
One Canada Square
Canary Wharf
London E14 5FA
United Kingdom
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454

Moody's Affirms Munich Re's Aa3 IFSR With a Stable Outlook
No Related Data.
© 2018 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL, FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for appraisal and rating services rendered by it fees ranging from $1,500 to approximately $2,500,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors. It would be reckless and inappropriate for retail investors to use MOODY’S credit ratings or publications when making an investment decision. If in doubt you should contact your financial or other professional adviser.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for appraisal and rating services rendered by it fees ranging from JPY200,000 to approximately JPY350,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.