Reuters logo
TEXT-S&P rates Fairfax Financial Holdings
October 11, 2012 / 7:15 PM / in 5 years

TEXT-S&P rates Fairfax Financial Holdings

Oct 11 - Standard & Poor's Ratings Services said today that it has assigned
its 'BBB-' global scale ratings to Toronto-based Fairfax Financial Holdings
Ltd.'s (Fairfax) pending issuance of up to C$200 million in 10-year fixed-rate
senior unsecured debt.

Fairfax intends to issue the senior notes from its current $2 billion 
universal shelf filing. We believe the company will use the proceeds to pay 
down outstanding debt of similar amount. We do not expect this issuance to 
have any major impact on financial leverage and coverage ratios. On a pro 
forma basis, as of June 30, 2012, Fairfax's total financial leverage was about 
31%, which is in line within our expectations.

In the first six months of 2012, Fairfax reported a pretax operating gain of 
$186 million as compared with a loss of $242 million in the same period in 
2011, largely as a result of a substantial reduction of catastrophe losses. 
Its combined ratio through the first six months of 2012 for ongoing operations 
was 98.1%, which includes three percentage points of catastrophe losses, 
versus 114.2% in the same period in 2011, which included 19.5 percentage 
points in catastrophe losses.

RELATED CRITERIA AND RESEARCH
Holding Company Analysis, June 11, 2009

RATING LIST

Fairfax Financial Holdings Ltd.
Issuer Credit Rating                    BBB-/Positive

NEW RATING

Fairfax Financial Holdings Ltd.
 Senior unsec notes due 2022            BBB-

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below