S&P cuts Royal & Sun

Standard & Poor's said it lowered to A- from A its financial strength and counterparty credit ratings on Royal & Sun Alliance Insurance plc and its core operating subsidiaries. S&P also lowered the ratings on the company's hybrid capital issues to BBB from BBB+ and the rating on its commercial paper to A-2 from A-1.

The ratings remain on CreditWatch, where S&P initially placed them with negative implications on Nov. 13. S&P has revised the CreditWatch implications to developing.

S&P said it believes the CEO's resignation following further reserve strengthening in Ireland and downward revision of profit expectations reflects a weakening in RSA management generally, notably in terms of consistency of strategy and operational effectiveness; specifically, it raises questions about the company's capacity to execute plans to strengthen capital and earnings.

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