Maiden Holdings is dealing with some A.M. Best ratings downgrades due to concerns about its operating performance.

The ratings agency downgraded the long-term issuer credit rating to “bb” from “bb-” for Maiden Holdings in Bermuda and in the U.S. Additionally, the company’s Maiden Re division had its financial strength rating knocked down to “B++” (good) from “A-” (excellent), and its long-term issuer credit rating was downgraded to “bbb” from “a-.”

Maiden’s ratings remain under review with negative implications.

“Operating performance has been assessed as marginal, as A.M. Best expects [Maiden Holdings] to post a third consecutive underwriting loss and a substantial net loss for the full year 2018, based on year-to-date results,” A.M. Best wrote in its explanation about the downgrade decision.

At the same time, A.M. Best noted a number of actions Maiden Re has taken to stabilize itself, such as its decision to sell Maiden Re North America to Enstar, allowing Enstar to also assume the liabilities connected with Maiden Holding’s reserves for its stake in Maiden Re through novation and retrocession agreements. There was also a loss portfolio transfer agreement Maiden signed with Enstar for the loss reserves related to its quota share reinsurance with AmTrust Financial Services, with which it is affiliated.

Maiden’s decision to close a renewal rights transaction with TransRe for its U.S. treaty reinsurance portfolio was also noteworthy, it said.

A.M. Best said it would cautiously await results from Maiden’s long-term push to revamp itself.

“While the adverse loss reserve development that has driven a significant portion of the losses will be removed from the group’s books by the transactions, future performance will be dependent on its ability to complete and successfully implement its strategic review,” A.M. Best said.

Earlier this year, Maiden Holdings President and CEO Art Raschbaum retired for personal reasons, with Maiden Re’s former general counsel Lawrence Metz named to succeed him. CFO Karen Schmitt retired as well, and Maiden Bermuda President Patrick Haveron became Maiden Holding’s new CFO.

Source: A.M. Best