S&P Global Ratings Inc. said Friday it has revised its outlook on Lloyd’s of London, the Society of Lloyd’s and its core subsidiaries to stable from negative, saying that under its new leadership team the market has taken the necessary steps to improve underwriting performance.

At the same time, S&P said it has affirmed its ‘A+’ financial strength rating of Lloyd’s.

“The steps Lloyd’s of London has taken to remediate its portfolio should ensure that its underwriting performance improves in 2019 to 2021. Management has also taken action to bring Lloyd’s catastrophe exposure back within its risk appetite,” S&P said in its research update.

After reporting over £3 billion ($3.78 billion) of losses in the past two years, Lloyd’s has also strengthened its capital adequacy, S&P said in the report.

“We now expect its capital to be significantly higher than our 'AA' confidence level over the next three years,” S&P said in the report.

S&P recently reported that several Lloyd’s of London syndicates were leaving the marketplace or reducing their underwriting after Lloyd’s crackdown on underperforming business.

S&P had revised its outlook on Lloyd’s to negative in October 2017, due to loss estimates from hurricanes Harvey and Irma.

The actions taken by Lloyd’s management in late 2018 to remediate some of the worst-performing business in the market should enable it to maintain capital levels, according to S&P.

“Lloyd's capital adequacy is likely to strengthen further in 2019 as the market's net premium written shrinks and Lloyd's continues to exercise stronger control over exposure to catastrophe risk,” S&P said in the brief.

On the downside, S&P said it could lower its ratings by one notch if Lloyd’s cannot maintain capital above its ‘AA’ requirement through 2019-2021, or if its competitive strength significantly weakens.

“This could be triggered by a further deterioration in underlying performance, compared with similarly rated reinsurers and insurers,” S&P said in the report.