Standard & Poor’s has removed Fremont General Corp. and related entities from Credit Watch. These ratings had been placed on CreditWatch on May 8, with negative implications.
Subsequently, Standard & Poor’s lowered its ratings on Fremont General Corp. and Fremont General Financing I and revised to ‘R’ its ratings on the members of the Fremont Comp Intercompany Pool. The outlook is negative. These rating actions follow the regulatory actions taken by the California Department of Insurance [see related story dated Nov. 30, 2000].
In a recent press release, Fremont announced that it does not plan to pursue external reinsurance transactions to address any potential adverse development of loss reserves as discussed in its October 2 press release. Instead, CDI has granted Fremont permission to discount loss reserves, which is expected to leave the company with a consolidated statutory surplus of about $220 million.
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