The counterparty credit rating on The St. Paul Travelers Cos. (St. Paul Travelers) reflects its very strong market position, the improved earnings of its insurance subsidiaries, which provides for strong coverage of fixed obligations, the strong statutory capital adequacy of the insurance operating subsidiaries, and conservative financial leverage. Partially offsetting these strengths is the group's legacy of substantial reserve charges, the possibility of further such actions, some residual impact on business volume from the integration of St. Paul Cos. Inc. and Travelers Property Casualty Corp. (TPC), and exposure to shareholder class action lawsuits arising from the merger. St. Paul Travelers' sustainable competitive strengths include its well-recognized brand and prominent market position in every region of the country except for the
