Pursuant to clause 8 (1) of the Insurance Companies (Ratings and Inspections) Act 1994, ratings agency Standard & Poor's has changed the international Royal & SunAlliance Group's ("the Group") "financial strength" rating to "A" on 20 August 2002.
This is one rung lower than its previous rating of "A+", and moves the company from the top of the "strong" range to the middle of the "strong" range.
This new rating applies to each of Royal
& Sun Alliance Insurance (New Zealand) Limited,
Royal & Sun Alliance Liability Insurance Limited, and Royal & Sun Alliance Accident Insurance Limited.
This action follows the re-grading of United Kingdom-based Royal & SunAlliance Group PLC following a decline in their capital levels which reflects the recent upheavals in the investment markets.
Standard & Poor's states, in relation to our parent company, that "an accumulation of pressures over the past three years has reduced capital adequacy to adequate levels in 2002, from very strong levels in 1999.
Royal & SunAlliance has made good progress toward its internal target of raising ú800 million ($1.22 billion) of capital, but weak investment markets during 2002 have hindered the capital-rebuilding program.
Royal & SunAlliance is, however, continuing to pursue
a number of alternative sources of capital in order to
be in a position to fully leverage its competitive market position."
In the Standard & Poor's report, it was noted that
an accelerated improvement in reported earnings is
expected during the second half of 2002 and that
Royal & SunAlliance's rating reflects the Group's excellent global market position in general insurance and an improving earnings outlook.
ALAN BRADLEY, Chief Executive.
Note: This notice appears as a matter of public record.