Standard & Poor's Ratings Services today said it placed its 'AA-' long-term counterparty credit and insurer financial strength ratings on Zurich-based global reinsurer Swiss Reinsurance Co. (Swiss Re) and its core affiliates on CreditWatch with negative implications.

"The CreditWatch placement comes in response to Swiss Re's disclosure that it incurred substantial additional asset write-downs during the fourth quarter of 2008, which will necessitate an increase in capital," said Standard & Poor's credit analyst Peter Grant. "Both the magnitude of the additional write-downs and the resulting need to raise capital are outside of our expectations."

We expect to be able to resolve the CreditWatch within the next two weeks. In resolving the CreditWatch, we will focus on evaluating the impact we believe today's announcement will have on the group's competitive position, earnings, capitalisation, and financial flexibility (defined as its level of access to capital relative to its needs). Based on available information, we currently do not expect to lower the ratings by more than one notch (i.e., to below 'A+').