A.M. Best Assigns Rating To Lloyd's Syndicate 2147

Business Wire, Jan 31, 2006

OLDWICK, N.J. -- A.M. Best Co. has assigned a Best's Syndicate Rating of A (Excellent) and an issuer credit rating (ICR) of "a" to Lloyd's Syndicate 2147 (United Kingdom), which is managed by SVB Syndicates Limited (SVBS). At the same time, A.M. Best has assigned an ICR of "bb " to SVB Holdings Plc (SVBH) (United Kingdom), the non-operating holding company of the SVBH group of companies, and debt ratings of "bb " on the USD 15 million and USD 10 million floating notes, and "bb" on the USD 11 million subordinated floating notes, all due in 2034, issued by SVBH. In addition, A.M. Best has assigned a "bb " rating on the GBP 50 million convertible bonds due in 2008, also issued by SVBH. The outlook for all the ratings is stable.

The ratings of syndicate 2147 reflect support provided by the financial strength of the Lloyd's market, which underpins the security of all Lloyd's syndicates. A.M. Best believes syndicate 2147's financial flexibility is enhanced by continued support provided by its parent, which may have the capability to raise additional funds if required. The syndicate's capacity for the 2006 year of account has been reduced to GBP 240 million (USD 430 million), down from GBP 286 million (USD 491.9 million) in 2005. The reduction has been made to reflect some anticipated softening in rates for certain classes (principally liability) and the sale of the Fusion book, although these factors are likely to be partially offset by an upturn in rates for some direct property business and catastrophe reinsurance.

A.M. Best forecasts solid profits (after personal expenses) of 18% of capacity for 2003 and 10% for the 2004 year of account--in line with the syndicate's September 2005 Quarterly Monitoring Return. As a result of the devastating 2005 U.S. hurricanes, A.M. Best believes the 2005 year of account is likely to produce a small loss. A.M. Best anticipates that the future financial performance of syndicate 2147 will benefit from hardening rates in 2006 in its property classes and reduced exposure to some liability classes where rates are softening.

A.M. Best believes that the syndicate has been able to establish an excellent profile, which is demonstrated by the volume of business it leads--approximately 42% of its premium volume in 2005. A.M. Best believes syndicate 2147 has become a diversified operation, with the property book likely to account for 43% of gross premiums in 2005, general liability 37%, marine 10% and aviation 10%. The syndicate has a U.K. and U.S. focus, with these regions accounting for 60% and 23% of 2005 gross premiums. A.M. Best believes the efforts of the syndicate's management to develop non-traditional sources of business via electronic hubs for the Novae book will assist in raising awareness of the syndicate's brand name in the United Kingdom.

For Best's Debt Ratings, all other Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.> A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.