Standard & Poor’s has placed its long-term A insurer financial strength and counterparty credit ratings of various Australian and New Zealand subsidiaries of Royal & SunAlliance Insurance Group PLC on CreditWatch with negative implications. This follows similar rating actions taken in London on operating entities of the British parent company.

The agency said in August that the parent organisation would have to strengthen its capital adequacy and deliver an improve earnings during the second half of 2002.

Mark Button, a credit analyst at S&P’s in London, said the CreditWatch placement reflects the agency’s increased surveillance of the group’s progress towards improving capital adequacy and meeting earnings expectations. “A CreditWatch placement with negative implications does not imply a downgrade,” he said.

R&SA will announce the results of its capital review within the next two weeks, together with an update on third-quarter results. Included in that may be some indication of the company’s intentions regarding its profitable Australian and NZ operations.