What’s New: In Brief (November 21, 2006)

Fitch Ratings has removed from Ratings Watch negative the ratings of Fairfax Financial Holdings Limited (Fairfax), Odyssey Re Holdings Corp. and its insurance subsidiaries (Odyssey Re), and TIG Holdings Inc.
The rating outlook for all of these companies is now stable. The move does not affect the holding company ratings of Crum & Forster Holdings Corp. and the insurance company ratings of Crum & Forster Insurance Group, Northbridge Financial Insurance Group and TIG Insurance Group.
“The rating action reflects a reduced level of uncertainty following a series of restatements over the past nine months related to the company’s finite reinsurance contracts and for numerous other accounting errors,” Fitch announced in a press release. “While Fitch is concerned about the internal control weaknesses demonstrated by the erroneous accounting, the restatements in total were not significant relative to the company’s capitalization.”
Fitch said its decision also reflected a “favorable view of Fairfax’s recent decision to reduce its ownership interest in Odyssey Re from 78.5% to approximately 60%.”
As a result of the share sale, Fitch noted, “the reduced Fairfax ownership improves Odyssey Re’s financial profile by lessening the ability of Fairfax to upstream dividends out of its strongest insurance subsidiary.”

Fitch Ratings has upgraded the financial strength rating of the SCOR group of companies to ‘A-‘ from ‘BBB+’.
“SCOR’s capital position has been further strengthened by the group’s ability to post recurring positive net income, the assumption of profitable life reinsurance policies as well as the conservative funding policy applied to finance acquisitions, the most important being Revios, which is expected to be closed in the very near future,” Fitch noted in a press release.
Fitch said it believes SCOR’s business position will further improve during the important 2007 renewal season. SCOR’s risk profile is also anticipated to improve.
“SCOR’s management team has established and implemented a consistent strategy over the past four years, reflected in the refocusing of the group’s franchise in countries and business lines in which it enjoys not only critical size but also competitive advantages,” Fitch said in a release. “Due to both internal and external growth, the group’s activities are now more evenly balanced between life and non-life reinsurance bringing material diversification, which has a favourable impact on the group’s risk profile.”