Leading rating agency AM Best yesterday affirmed the financial strength ratings of the Zurich Financial Services Group, but said it was keeping a close eye on Zurich?s Bermuda-based subsidiary Centre Solutions Ltd. after its ?weak performance?.

Much of the business at Centre was placed in run off last year after its parent, Zurich, said that it would wind down Centre?s business in a bid to put more focus on its ?core business?.

Many of Centre?s staff were let go and the e-Venture Centre ? a business incubator that had been set up by Centre as a venture capital project ? was shut down.The Zurich Group, a Swiss-based company, and its core subsidiaries carry a financial strength ratings of A (Excellent) from AM Best. The outlook on Zurich?s financial services rating remains positive, or unlikely to change.

AM Best said yesterday that the company?s rating was affirmed after it announced third quarter earnings of $1.4 billion. The rating agency said those results were in line with its expectations, which it said was an improvement of $4.2 billion year-on-year.

In addition, the company posted an improved consolidated combined ratio ? an indication of the profitablilty of its underwriting operations ? of 98.2 percent.

However, AM Best said it continued to be concerned about subsidiary Centre Solutions? ?weak performance? and that its rating was currently under review with negative implications ? an indication that its rating would likely be downgraded.

Centre?s reserves were strengthened by a $354 million before tax injection last quarter, as Zurich sought to account for possible prior year losses. Although Zurich said it did not anticipate further adverse development requiring further boosts to Centre?s reserve levels, AM Best said it would continue to ?closely monitor Centre?s reserve position?.