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XL Capital Assurance Issues $49.67 Million Guarantee of First Costa Rican Housing Finance Corp. Series 2002-1

First Residential Mortgage-Backed Securitization in Costa Rica New York, New York, September 10, 2002 - XL Capital Group Assurance Inc. ("XLCA"), rated triple-A by Moody's Investors Service ("Moody's") and Standard & Poor's Ratings Services ("S&P"), and Fitch Ratings ("Fitch"), today announced that it has issued a financial guarantee insurance policy ? the first residential mortgage-backed securitization in Costa Rica ? for the $49.67 million Costa Rican Housing Finance Corp. Series 2002-1, Class A Notes.
The transaction is also the first Costa Rican transaction in which the ratings assigned by Moody's and S&P are higher than the sovereign ratings of the country where the underlying loans were originated.
S&P's AAA and Moody's Aaa ratings of the Class A Notes reflect XLCA's financial guarantee policy. The transaction benefits from a transfer and inconvertibility risk policy from a AA-rated insurer.
The residential mortgages were originated by Banco Interfin S.A. and Banco de San José S.A., the second- and third-largest private financial institutions, respectively, in Costa Rica. This is the first securitization for both institutions.
David C. Stevens, President of XLCA, commented, "We are very pleased to have participated in this ground-breaking transaction, which allowed customers assuming high-quality risks in sub-investment grade environments to benefit from our triple-A support."
Raymond James arranged and placed this pioneering transaction. "We were mandated by Banco Interfin and Banco de San José to develop a Costa Rican mortgage securitization program and transaction structure to access global capital markets. This successful U.S. placement has met that client objective," said Devinda R. Subasinghe, Vice President, Fixed Income, Raymond James.
Luis Liberman, Chief Executive Officer of Banco Interfin said, "This is a revolutionary transaction for our bank and our country, and opens exciting new possibilities for the future. These transactions are an integral part of our long term strategy for the Costa Rican housing market and we expect this to be the first in a series of deals."
Federico Odio, Chief Financial Officer of Banco de San José, added "This is a historical event in the region's history, because it is the first time that a bank is able to tap the financial markets for long term funding. It is very encouraging for us to be able to succeed in a project like this, because we have been able to convey confidence to the international community, in Costa Rica, including its legal system and its financial institutions, as well as a positive outlook on the economic situation, despite all the turbulence in other Latin American countries. It is particularly exciting for us to visualize the opportunities that this program opens up for the future, for the mortgage sector in the country. With this program, our clients will benefit from improved conditions for financing and the bank will be able to capitalize on better access to liquidity, cost of funds, and eventually benefit from risk transference."
Richard Pfaltzgraff, Managing Director of XLCA, said, "This transaction represents several firsts ? including the first-ever securitization by our clients, Banco Interfin and Banco de San José. Our clients were able to access the international capital markets to increase liquidity for the banks to continue to grow their franchises. This transaction is representative of XLCA's dedication to tailoring structures that will help our clients meet their specific goals."
XL Capital Group Assurance Inc., rated triple-A by Moody's, S&P, and Fitch, is a New York-domiciled financial guarantee insurer that specializes in corporate and consumer asset securitization, structured funds, essential infrastructure project finance, future flow securitization and U.S. public finance. At June 30, 2002, XLCA had statutory assets of approximately $205.8 million, liabilities of approximately $73.5 million and surplus as regards policyholders of approximately $132.3 million.
XLCA is a subsidiary of XL Capital Ltd (NYSE: XL) which, through its principal operating subsidiaries, is a leading provider of insurance and reinsurance coverages and financial products to industrial, commercial and professional service firms, insurance companies and other enterprises on a worldwide basis. At June 30, 2002, XL Capital Ltd had consolidated assets of approximately $31.2 billion and consolidated shareholders' equity of approximately $5.4 billion.
This press release may contain forward-looking statements. Such statements are based on current plans, estimates and expectations. Accordingly, forward-looking statements involve inherent risks and uncertainties and a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. XLCA does not undertake any duty to update publicly any forward-looking statements contained herein in light of new information or future developments.

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