In its announcement, Moody's highlighted the first-half 2002 results released by the reinsurer Aug. 29, noting that while results for its core property-casualty and life units were positive, overall net income was adversely affected by lower investment income and realized gains.

The results were also adversely impacted by claims in its credit solutions business, Moody's said, noting that overall net income was 118 million Swiss Francs ($78.6 million), compared to 1.3 billion ($866 million) for the same period last year.

Moody's added that Swiss Re's reported shareholders' equity declined to 18.3 billion ($12.2 billion) Swiss Francs from 22.6 billion ($15.1 billion) as of year-end 2001.

"While the outlook for Swiss Re's premium income remains positive for the years 2003 and into 2004, the outlook for investment income remains subdued," the rating agency said. While "internal capital generation is expected to be strong, it may not be sufficient to restore the company's equity base to historical levels," which had been exceptional, Moody's said.

Separately, on Aug. 30, Standard & Poor's announced that it put Swiss Re's "triple-A" credit and insurer financial strength ratings on CreditWatch with negative implications. S&P also cited concerns that the reinsurer's capital level had decline to a level inconsistent with it current rating category.