Bermuda-based RenaissanceRe Holdings Ltd. announced today itexpects to record two charges totaling $181.7 million that willimpact its fourth-quarter 2007 results.

One charge will result in a write-off of its total $126.7million investment in ChannelRe Holdings Ltd., a privately heldfinancial guaranty reinsurer, and a second $55 million charge toincrease incurred but not reported (IBNR) reserves forsubprime-related exposures in its casualty clash reinsurance bookof business.

Ratings agencies A.M. Best Co. and Standard & Poor's saidthe announcement would not affect the company's ratings.

A.M. Best commented that the issuer credit rating of “a-minus”and all associated debt ratings of RenaissanceRe Holdings Ltd. aswell as the financial strength rating of “A-plus (Superior)” andissuer credit rating of “double-a-minus” of the lead company,Renaissance Reinsurance Ltd., are unchanged.

A.M. Best said the remaining ratings and outlook on allRenaissanceRe affiliates also are unchanged.

Standard & Poor's Ratings Services said that its ratings of“A (stable)” on RenaissanceRe Holdings Ltd. and related entitiesalso were not affected by the company's announcement.

S&P said the full write-down of the investment isappropriate given that ChannelRe is expected to recordfourth-quarter unrealized mark-to-market losses on its financialguaranty contracts that will exceed its shareholders' equity.

Ren Re accounts for its 32.7 percent interest in ChannelRe underthe equity method of accounting, and its share of these chargesresults in a reduction in its carried value of ChannelRe to zero,Best said.

Standard & Poor's said it has entirely written off theinvestment in ChannelRe and no credit was given in Ren Re'srisk-adjusted capital adequacy ratio, which is expected to remainextremely strong at year-end 2007.

The expected increase of $55 million in Ren Re's IBNR reflectsits estimated losses related to subprime exposures in its casualtyclash reinsurance book, S&P said.

These policies were principally written on a claims-made basisand the ultimate losses are expected to be contained within theposted reserves.

Although these two charges are material, Standard & Poor'ssaid it still expects the reinsurer to report a profit infourth-quarter and full-year 2007 and in addition anticipates anROE of more than 15 percent in 2007.

S&P said the charge arises principally from ChannelRe'sestimate of its fourth-quarter unrealized mark-to-market lossesfrom financial guaranty contracts accounted for as derivativesunder generally accepted accounting principles, based oninformation recently furnished to ChannelRe by its sole cedant.

The company said it anticipates reporting profitable results forthe fourth quarter of 2007 and the full year, inclusive of thesecharges. The company also said it expects to issue its earningsrelease and financial supplement following the close of market onFeb. 5.

At the same time, PartnerRe Ltd. also announced that it expectsto record a non-operating charge of $74 million to write down itstotal investment in ChannelRe.

PartnerRe owns a 20 percent equity interest in ChannelRe. AtSept. 30, 2007, the carrying value of the company's investment inChannelRe was $74 million.

RenaissanceRe Holdings Ltd. provides reinsurance and insurance,with reinsurance managed by subsidiary RenaissanceRe Ventures Ltd.,and individual risk, which includes primary insurance and quotashare reinsurance.