Troubled (re)insurer Trenwick has won 11th-hour support from its financial backers to continue unde...Troubled (re)insurer Trenwick has won 11th-hour support from its
financial backers to continue underwriting at Lloyd's but has put its
London company operation, Trenwick International, into run-off.
Bermuda-based Trenwick's backers at Lloyd's finally agreed in principle to
renew $182m of letters of credit as a previous $226m credit facility ran
out in late November.
As it negotiated renewal of the credit facility, Trenwick suspended
dividend payments on its preferred shares and trust-preferred securities
under the terms of an agreement with its letter of credit providers,
prompting rating agencies to lower Trenwick's preferred stock and debt
Moody's said its action was also due to concerns about Trenwick's
liquidity and its future business prospects. The (re)insurer reported an
operating loss of $143m for the first nine months of 2002, largely due to
increases in loss reserves at its US subsidiaries and Trenwick
Trenwick has hired financial adviser Greenhill and Co. to help it "in
evaluating and implementing a restructuring of its outstanding
indebtedness and preferred equity".
Trenwick's forecast capacity at Lloyd's for 2003 is $500m, which includes
the $182m credit facility, capital from Trenwick and £100m ($157m) of
capital from, and a £30m qualifying quota share agreement with, Berkshire
Hathaway's subsidiary National Indemnity.
Trenwick will take a charge in its fourth quarter 2002 accounts for the
expenses of putting Trenwick International, its specialty London market
insurer, into run-off.
The closure of Trenwick International had been expected. Trenwick had said
it would concentrate its London underwriting at Lloyd's and had moved
lines of business, including property and aviation, from Trenwick
International to Lloyd's.
Click here for a
Špdf of this story
A huge well done to all involved with organising our Remembrance Day event on Friday, including our Corporate Real Estate team. One of them, Ibrahim, took this incredible footage of poppies dropping as he (along with others) leaned (safely!) over the gantry to let them go. pic.twitter.com/pSbapkWBBR— Lloyd's (@LloydsofLondon) November 12, 2018
- RSA pulls out of three London market lines
- Interview: Ian Muress, Sedgwick International
- Mike Brockman reveals plans for ‘next generation’ telematics
- California wildfire losses expected to hit record levels
- Hyperion takes on $115m of debt to fund further acquisitions
- Aviva to transfer 1.39m policies to Irish post-Brexit hub
- Wider sector may face similar scrutiny to 'too big to fail' insurers