A.M. Best Assigns Rating to Trust Preferred Securities Issued by Zurich Holding Company of America

Business Wire, May 16, 2007

OLDWICK, N.J. -- A.M. Best Co. has assigned a rating of "bbb" to the USD 1.5 billion subordinated trust preferred securities issued by Zurich Holding Company of America (ZHCA) (United States) through ZFS Finance (USA) Trust IV for a principal amount of USD 500 million and ZFS Finance (USA) Trust V for a principal amount of USD 1 billion. The rating is based on the subordinated support agreement from Zurich Financial Services (ZFS) (Switzerland) and Zurich Group Holding.

The proceeds of this issue will be used to replace an existing subordinated debt of up to USD 1 billion and the remainder for general corporate purposes. The series IV and V securities, which are callable on and after 9 May 2012 and 9 May 2017, respectively, bear an initial interest rate of 5.875% (series IV) and 6.500% (series V) payable semi-annually in arrears. Following the call dates, the series IV and V will have interest rate resets at 181.5 and 228.5 basis points above LIBOR, respectively, payable quarterly in arrears. The series IV and V have a respective scheduled maturity date of May 9, 2032 and May 9, 2037.

Financial and debt leverage ratios remain within A.M. Best tolerance levels. A.M. Best has given full credit to the proceeds, as ZFS' level of subordinated debt remains within the limit of 20% of the risk-adjusted capitalisation.

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.> Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors. For more information, visit www.ambest.com.