Outlook Neg. for Monoline Re’s

S&P changed its outlook to negative from stable on monoline reinsurers Ace Guaranty Re Inc., Axa Re Finance S.A., Radian Reinsurance Inc., and RAM Reinsurance Co Ltd.

The outlook assesses the potential direction of an issuer’s financial strength rating over the intermediate to longer term. S&P’s analysis indicates that the monoline reinsurers have suffered deterioration in their business positions relative to the primary companies from which they assume business.

An S&P spokesperson indicated the companies are now assuming business that is less diversified, less profitable, and of a higher risk profile relative to the business written by the primary monoline companies. That trend, which is expected to continue, is not consistent with maintaining “AAA” financial strength ratings, according to S&P.