July 6, 2012 / 9:14 PM / 8 years ago

TEXT-Fitch affirms Belize Sovereign Investments III

(The following statement was released by the rating agency)

July 6 - Fitch has taken the following rating action on the notes issued by Belize Sovereign Investments III (BSI): — $85.7 million notes affirmed at ‘A’; Outlook Stable. The rating action reflects Fitch’s Insurer Financial Strength (IFS) rating of Steadfast Insurance Company (Zurich Insurance Company Ltd.; ‘A+’, Outlook Positive). The affirmation of the notes also reflects the timely payment of interest on a semi-annual basis. The one-notch rating differential reflects limitations to the policy’s claims-paying probability. Specifically, Fitch focused on the policy’s conditionality, termination events, and claims-paying process. Fitch believes this claims-paying process is straightforward with limited conditions and limited potential for timing delays. Repayment of the notes is backed by two restructured government of Belize (GOB) sovereign obligations that benefit from two insurance policies underwritten by Steadfast. Each GOB obligation has its respective insurance policy which directly covers any non-payment by the GOB. Payments from the GOB on the underlying notes will pass through to the BSI trust to cover payments on the BSI notes. The amortization schedules are identical. Zurich Insurance Company Ltd. is the primary operating entity of the Zurich Financial Services group and acts as a holding company for the insurance operating subsidiaries. The group has focused on insurance since 2002 and has a strongly developed insurance franchise. (Caryn Trokie, New York Ratings Unit)

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