SYNDICATE 780 PUT ON RATINGS WATCH BY MOODY’S

Rating agency Moody’s has placed Lloyd’s syndicate 780 on ratings watch with negative implications after expressing concern at its level of capital support. The syndicate, managed by Advent, has seen its support from Lloyd’s names fall to £71m this year, down from £107m in 2004. Corporate support from Advent Capital has fallen to £82m from £102m. Canada-based Fairfax Group has £110m on deposit with Advent, but this is part of a five-year commitment from Fairfax to support Advent that expires at the end of this year. The sum represents just under half the syndicate’s capacity for 2005. Fairfax has indicated that it probably will not renew the arrangement. Advent hopes to raise permanent capital to support its future underwriting; completion of a strategic review is due this month. Syndicate 780 is a reinsurance-focused operation, with just over a third of its business being treaty reinsurance and just under 30% being assumed reinsurance. Non-marine property insurance makes up a further 18%.