HAMILTON, Bermuda (BUSINESS WIRE) - RAM Holdings Ltd. has responded to an announcement by Standard & Poor's Ratings Services (S&P) last week that it has placed the AAA financial strength and financial enhancement rating of RAM Reinsurance Company Ltd. on CreditWatch with negative implications.

S&P stated that its rating action reflects its view of the shortfall of RAM Re's capital cushion of approximately $82-$132 million at December 31, 2007, relative to projected sub-prime losses under S&P's stress test.

S&P stated that the rating action also incorporates and elevates the importance of RAM Re demonstrating improved financial metrics, as first cited in July 2006, when S&P assigned negative outlooks to RAM Re and RAM Holdings.

As previously stated in connection with Moody's announcement that RAM Re's Aa3 rating was placed on negative watch on February 1, RAM is pursuing a number of alternatives to improve its capital position, including seeking reinsurance and reducing its growth. Due to current market conditions, RAM does not expect to raise new capital at the present time.

RAM's strategy remains subject to change, and there can be no assurance that RAM will be successful in improving its capital position within the timeframe required by S&P or in maintaining its current rating from S&P.