Rating agency AM Best has said its credit rating for the St. Paul Companies' will not be downgraded because of the company postponing its initial public offering for its newly formed Bermuda reinsurance venture.

The new company, Platinum Underwriters Holdings was supposed to have its stock market debut in late June but got pushed off after volatile market conditions.

Platinum's formation followed St. Paul's management deciding it should exit certain areas of reinsurance, including aviation, bond and credit reinsurance. The company also decided that its primary insurance business should be separate from its reinsurance operations "because of their different risk profiles and business characteristics."

St. Paul will own 15.3 percent of the company after the IPO. Net premiums from that St. Paul business rose to $415 million in the first quarter from $341 million a year earlier. Platinum plans to begin initial trading on the New York Stock Exchange today under the symbol PTP.

The good news from AM Best follows the company's downgrade by the S&P.

AM Best said St. Paul's financial strength rating of A (Excellent) would be unaffected by the IPO's postponement.

The group's existing debt ratings were also said to be unaffected.

AM Best said it believed the planned transfer of St. Paul's reinsurance business to Platinum via the IPO would reduce the

volatility of St. Paul's earnings. And the transfer would free up capital at St. Paul, which is necessary to support the growth of the businesses it retains given its loss of surplus in 2001.

AM Best said it would continue to hold discussions with St. Paul's senior management on the progress of the planned IPO.