Platinum Underwriters Holdings Ltd.'s (PTP) subsidiaries Platinum Underwriters Bermuda Ltd. and Platinum Underwriters Reinsurance Inc. have been assigned an 'A' insurer financial strength (IFS) by Fitch Ratings. The rating outlook is stable.

The ratings reflect PTP's solid profitability, earnings and cash flow benefits derived from the company's diverse book of business and the strong support the company's high-quality and liquid investment portfolio provides for its loss reserves.

The ratings also incorporate Fitch's belief that PTP's underwriting margins are likely to contract in the near-to-medium term as premium rates in the company's core lines continue to face cyclical pricing pressure. In addition, the ratings consider PTP's exposure to potential adverse reserve development from the company's casualty lines reserves and significant catastrophe exposure.

PTP's first-half 2008 earnings were strong as the company generated a 22.3-percent annualised net return on average common equity and a 73.7 percent combined ratio. Fitch views PTP's 2006 and 2007 underwriting profitability as generally consistent with that of the company's peers reflecting comparatively light catastrophe-related losses and favourable reserve development. Fitch's expectation is that underwriting margins industry-wide are likely to be pressured over the next 12 to 18 months and the agency expects PTP to be affected by this trend.

Fitch views Platinum's investment portfolio, which at June 30, 2008 was invested almost entirely in investment grade fixed-income and short-term instruments, as a high-quality portfolio with strong liquidity characteristics. Fitch also views the quality of Platinum's capital base as high, since the company has little exposure to reinsurance recoverables or to intangible assets.

• Platinum Underwriters Holdings Ltd. increased its buy-back programme to $250 million. The increase adds $46 million to $204 million currently authorised in the company's repurchase programme.

The company currently has about 48.9 million shares outstanding.