A.M. Best Affirms Ratings Of Maiden Holdings
A.M. Best Co. has affirmed the financial strength rating [FSR] of A- [Excellent] and issuer credit ratings [ICR] of “a-” of the property/casualty subsidiaries of Bermuda’s Maiden Holdings, Ltd.
Concurrently, A.M. Best has affirmed the ICR of “bbb-” of Maiden Holdings and the debt rating of “bb” on its preferred stock.
Additionally, A.M. Best has affirmed the ICR and senior debt ratings of “bbb-” of Maiden Holdings North America, Ltd., a direct, wholly-owned subsidiary of Maiden Holdings.
Maiden NA’s senior notes are fully and unconditionally guaranteed by Maiden Holdings. The outlook for all ratings is stable.
A Best spokesperson said: “The ratings reflect Maiden’s consistently profitable underwriting and operating performance, along with its solid risk-adjusted capitalisation, in part due to capital contributions from Maiden Holdings, and the operational benefits that Maiden derives as a quota share partner with AmTrust Financial Services, Inc.’s [AFSI] Bermuda reinsurance subsidiary, AmTrust International Insurance, Ltd., and American Capital Acquisition Corp [ACAC].
Partially offsetting these positive rating factors are the execution risk faced by Maiden in achieving its business plans, the continuing competitive environment in its core reinsurance markets and its client concentration, as AFSI and ACAC account for approximately 60 percent of the group’s total gross premiums.
Maiden Holdings’ adjusted debt-to-total capital, excluding accumulated other comprehensive income of 24.7 percent and adjusted debt-to-total tangible capital, excluding accumulated other comprehensive income of 26.8% at December 31, 2012 were within A.M. Best’s guidelines for the company’s ratings. In addition, Maiden Holdings’ interest coverage ratio remains adequate for its ratings.
Best said key rating factors that may lead to positive rating actions include the organisation producing operating results that exceed its peers for an extended period, along with the strengthening of its risk-adjusted capitalization. However, factors that may lead to negative rating actions include a trend of increasingly deteriorating underwriting and operating performance to a level below the group’s peers or an erosion of surplus to such an extent to cause a significant decline in risk-adjusted capitalisation.
Maiden Holdings Ltd. is a Bermuda-based holding company with insurance subsidiaries that provides specialty reinsurance products for the global property and casualty market.
