4.4 Legal risk - Scor

FINANCIAL LEVERAGE
As at 31 December 2012, the Group’s financial leverage was 19.9% as compared to 18,1% at 31 December 2011. This ratio
is calculated as the percentage of subordinated debt (1) compared to total shareholders’ equity plus subordinated debt. The
increase in 2012 is due to the placements of perpetual subordinated notes described above under Section 10.1.
The total liquidity of the Group of EUR 2.735 billion (comprised of cash and cash equivalents and short term investments)
and the low financial leverage ratio reflects the Group’s treasury and financing strategy to have a strong level of liquidity..
10.4 Restrictions on the use of capital
Refer to Section 4.3.1 with respect to the risk related to letters of credit granted by SCOR to cedants which require a 100%
collateral in case of non-compliance with financial covenants or in case of a decrease in the Group’s financial strength
rating.
For information on regulatory restrictions on the use of capital, refer to Section 5.1.4.2 – Legal form and applicable
legislation and to Section 20.1.6.13 – Notes to the Consolidated Financial Statements, Note 13 – Information on share
capital, capital management, regulatory framework and shareholders’ equity.
Until 8 August 2012, SCOR Switzerland AG was subject to certain specific reporting requirements stipulated by the Swiss
Financial Market Supervisory Authority (“FINMA”) as per the decree of 1 April 2010. As at 8 August 2012 these specific
reporting requirements were fully revoked and only the regulatory requirements are to be observed by SCOR Switzerland
AG.
In addition, the Group and its companies are subject to certain financial covenants (minimum net worth requirements and
maximum debt levels) under the terms of certain stand-by letter of credit agreements. Non respect of said covenants might
lead to an increase in the percentage of required collateralization.
10.5 Sources of financing relating to the future
investments by the company and to its property, plant
and equipment
Within the strict respect of the criteria defined by its strategic plan, SCOR is watchful to dispose of a large access to any
available and appropriate sources of financing in order to ensure the permanent display of its activities and strategy.
( 1 ) In respect of the CHF 315 million subordinated debt issuance, SCOR entered into cross-currency swaps which exchanges the CHF principal and coupon into
EUR, and matures on 8 June 2018. The calculation of the ratio includes the effect of these swaps.
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