S&P rates XL Capital preferreds BBB

Standard & Poor's said it assigned its BBB preferred stock rating to XL Capital Ltd.'s proposed $1 billion series E perpetual noncumulative preference ordinary shares offering.

At the same time, S&P said it affirmed its A- counterparty credit ratings on XL and its core holding company, X.L America Inc.

In addition, the agency said it affirmed its A+ counterparty credit and financial strength ratings on XL's core operating companies.

The outlook on all these companies remains stable.

The ratings on XL are based on its very strong global market presence, very strong interest and fixed-charge coverage and diversified earnings stream, S&P said, adding that somewhat offsetting these strengths are a track record of inconsistent earnings performance, material, though reduced, exposure to large catastrophic losses, susceptibility to adverse reserve development and business-integration challenges borne from the relatively rapid and successful building of a very strong and diversified global competitive position.

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