Moody's lowers Scottish Re

Moody's Investors Service said it downgraded the preferred stock debt rating of Scottish Re Group Ltd. to Caa3 from B2 and the insurance financial strength ratings of the company's core insurance subsidiaries, Scottish Annuity & Life Insurance Co. (Cayman) Ltd. and Scottish Re (U.S.), Inc., were lowered to Ba3 from Baa3.

The agency said that the ratings were left on review for possible further downgrade, continuing a review that had been initiated on Feb. 15.

Moody's noted that the rating action follows an announcement by the company that it would alter its strategic focus in response to business challenges it faces in writing new business, partly as a result of market conditions and its substantial exposure to subprime and Alt-A investments.

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