Standard & Poor’s (S&P) affirmed its “A” rating of American Capital Access (ACA) with a “stable” outlook on the insurer.
S&P’s action, which it took on Sept. 30, 2004, followed receipt of $140 million in new capital, mostly from an investment by Bear Stearns Merchant Banking, which will now hold three of 10 seats on the ACA Board. ACA’s total statutory capital exceeds $300 million on a pro forma basis.
The new capital infusion satisfies S&P’s concerns, first voiced in early May 2004, that ACA’s business growth required greater capital resources than available at that time. In its reaffirmation, S&P also noted its continued confidence in ACA’s approach to underwriting and risk management as well as the insurer’s management team.
ACA is a niche insurer providing bond insurance for bond issues of smaller size, first time issuers and lower rated credits that it judges to have a strong capacity to pay and that have been overlooked or are not served by larger insurers for other reasons.
