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A.M. Best Co. announced that it has assigned a rating of “a+” to the €1 billion ($1.2789 billion) perpetual step up-notes “issued by ELM B.V., a bankruptcy remote repackaging vehicle based in the Netherlands, and are secured over perpetual subordinated step-up loan notes issued by Swiss Reinsurance Company.”

Best also said it has assigned a rating of “a+” to the $750 million perpetual subordinated step-up preferred securities “issued by Jersey (UK)-based Swiss Re Capital I L.P. and guaranteed by Swiss Re on a subordinated basis.”

At the same time Best noted that it “has placed these ratings under review with negative implications, in line with the rating action on Swiss Re in connection with the acquisition of GE Insurance Solutions. (See related A.M. Best press release of November 18, 2005.)

“The ratings of these issues reflect the deeply subordinated nature of these securities and the financial strength of the collateral obligor and guarantor, respectively. A.M. Best will credit these hybrid securities up to a limit of 20 percent of total adjusted capital.”