S&P Global Ratings affirmed its A- long-term counterpartycredit rating on Arch Capital GroupLtd.
The rating agency also affirmed its A+ financial strengthand long-term counterparty credit ratings on Arch Capital Group's core entitiesand its A- financial and long-term counterparty credit ratings on Additionally,S&P lowered its financial strength and long-term counterparty credit ratingson Arch Mortgage Insurance Designated Activity Co. to A from A+.
The outlook is positive on Arch Mortgage Insurance Co.and stable on all other entities.
S&P said the ratings on Arch Capital Group and itssubsidiaries reflect its strong competitive position based on its diversified re/insuranceplatform and strong financial risk profile based on very strong capitalization,moderate risk position and strong financial flexibility.
The rating agency added that the ratings on Arch MortgageInsurance Co. reflect its view of the company's adequate competitive position reflectingits monoline business, leadership in the credit union lending channel, expandingmarket presence into the bank lending channel, improving operating performance anddiversified footprint in the U.S. The ratings also reflect moderately strong capitalizationand a moderate risk position.
The downgrade on Arch Mortgage Insurance Designated Activityreflects S&P's revised view of the company's group status to highly strategicallyimportant from core.
The stable outlook on Arch group reflects the rating agency'sview that the group will maintain a strong competitive position, a strong financialrisk profile supported by very strong capitalization and a moderate risk position,and strong enterprise risk management. The stable outlook on Arch Mortgage InsuranceDesignated Activity reflects S&P's expectation of continued growth support,while the positive outlook on Arch Mortgage Insurance Co. recognizes its potentiallyincreased importance to the overall group in the near to medium term as it growsthrough expansion in the bank channel in a disciplined manner to achieve meaningfulscale, the rating agency said.
S&PGlobal Inc. owns S&P Global Ratings and S&P Global Market Intelligence.