Additionally, the upgrade of the Foreign currency long-term IDR reflect ratings
that were capped by the sovereign rating
of Brazil and remain in most cases below the Local currency long-term IDR of the issuers.
Fitch's upgrade of the Federative Republic of Brazil's ratings
are a result of the country's on-going improvement in public and private external finances and a macroeconomic policy framework that has proved robust in the face of political and financial market pressures.
actions reflect Fitch's belief that CBCF will be successful in its efforts to minimize attrition of RBNC customers.
The implementation of the new ratings
standards was done concurrently for most insurance sectors globally, and follows the publication of an exposure draft of the noted methodology report on Dec.
The new ratings
methodology is designed to add greater transparency to Fitch's insurance industry ratings
by more clearly assessing the effect of default risk and recovery given default on ratings
As a result of incorporating recovery into specific issue ratings
, several of these unique players received ratings
above their corporate FC IDR to reflect higher levels of expected recovery, on average, given default when caused by a systemic risk event such as a sovereign or external liquidity crisis.
For more information, see Fitch Research dated April 13, 2006, available on the Fitch Ratings
web site at www.
Fitch's actions also incorporate its belief that AIG's domestic commercial lines property/casualty companies' medium-term focus includes building and retaining capital to more appropriate levels for the current ratings
3%, of the combination of S&P/Fitch and Moody's/Fitch ratings
, respectively, were either the same or within one notch;
Greater details on Fitch's new guidelines governing notching of issue ratings
relative to the IDR, as well as the notching between Insurer Financial Strength Ratings
(IFS) at an operating company level and debt ratings
at a holding company level are available in the noted methodology report.
The following ratings
experienced upward revisions upon implementation of the new guidelines:
For holding companies that primarily own Bermuda domiciled insurance subsidiaries, the notching spread between insurance company financial strength ratings
and holding company debt ratings
is typically narrower under this new methodology, compared with U.