A.M. Best Affirms Ratings of Maiden Holdings, Ltd. and Its Subsidiaries

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of "a-" of the property/casualty subsidiaries of Maiden Holdings, Ltd. (Maiden Holdings) (Hamilton, Bermuda) [NASDAQ: MHLD], also known as Maiden Group (Maiden). Concurrently, A.M. Best has affirmed the ICR of "bbb-" of Maiden Holdings and the debt rating of "bb" on its preferred stock. Additionally, A.M. Best has affirmed the ICR and senior debt ratings of "bbb-" of Maiden Holdings North America, Ltd. (Maiden NA) (Delaware), a direct, wholly owned subsidiary of Maiden Holdings. Maiden NA's senior notes are fully and unconditionally guaranteed by Maiden Holdings. The outlook for all ratings is stable. (See below for a detailed listing of companies and ratings.)

The ratings reflect Maiden's consistently profitable underwriting and operating performance, along with its solid risk-adjusted capitalization, in part due to capital contributions from Maiden Holdings, and the operational benefits that Maiden derives as a quota share partner with AmTrust Financial Services, Inc.'s (AFSI) Bermuda reinsurance subsidiary, AmTrust International Insurance, Ltd., (AII) and American Capital Acquisition Corp (ACAC).

Partially offsetting these positive rating factors are the execution risk faced by Maiden in achieving its business plans, the continuing competitive environment in its core reinsurance markets and its client concentration, as AFSI and ACAC account for approximately 60% of the group's total gross premiums. Maiden Holdings' adjusted debt-to-total capital, excluding accumulated other comprehensive income of 24.7% and adjusted debt-to-total tangible capital, excluding accumulated other comprehensive income of 26.8% at December 31, 2012 were within A.M. Best's guidelines for the company's ratings. In addition, Maiden Holdings' interest coverage ratio remains adequate for its ratings.

Key rating factors that may lead to positive rating actions include the organization producing operating results that exceed its peers for an extended period, along with the strengthening of its risk-adjusted capitalization. However, factors that may lead to negative rating actions include a trend of increasingly deteriorating underwriting and operating performance to a level below the group's peers or an erosion of surplus to such an extent to cause a significant decline in risk-adjusted capitalization.

The FSR of A- (Excellent) and ICRs of "a-" have been affirmed for the following property/casualty subsidiaries of Maiden Holdings, Ltd.:

  • Maiden Insurance Company Ltd.
  • Maiden Reinsurance Company
  • Maiden Specialty Insurance Company

The following debt ratings have been affirmed:

Maiden Holdings, Ltd.—

-- "bb" on $150 million 8.25% preferred stock

Maiden Holdings North America, Ltd. (guaranteed by Maiden Holdings, Ltd.)

-- "bbb-" on $100 million 8.0% senior unsecured notes, due 2042

-- "bbb-" on $107 million 8.25% senior unsecured notes, due 2041

The following indicative ratings have been affirmed for securities under the shelf registration

Maiden Holdings North America, Ltd. (guaranteed by Maiden Holdings, Ltd.)

-- "bbb-" on senior unsecured debt

-- "bb+" on subordinated debt

-- "bb" on junior subordinated debt

-- "bb" on preferred stock

The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

A.M. Best
Brian O'Larte, 908-439-2200, ext. 5138
Senior Financial Analyst
Rachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations
Michael Lagomarsino, CFA, 908-439-2200, ext. 5810
Assistant Vice President
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations

KEYWORDS:   United States  Bermuda  Europe  North America  Caribbean  Delaware  New Jersey


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