2013-12-20 17:33:01 -
A.M. Best Asia-Pacific Limited has affirmed the financial strength rating of A- (Excellent) and the issuer credit ratings (ICR) of “a-” of Asia Capital Reinsurance Group Pte. Ltd. (Asia Capital Re) (Singapore) and Asia Capital Reinsurance Malaysia Sdn. Bhd. (ACRM) (Malaysia). A.M. Best also has affirmed the ICR of “bbb-” of ACR Capital Holdings Pte. Ltd. (ACR) (Singapore). The outlook for all ratings is stable.
The ratings reflect Asia Capital Re and ACRM’s adequate capitalization and enhanced enterprise risk management. A.M. Best also acknowledges the companies’ disciplined and prudent investment strategies.
The operating performance of Asia Capital Re and ACRM improved in fiscal year 2012. Asia Capital Re reported a net profit of USD 61.2 million for the fiscal year ending March
31, 2013, and ACRM reported a net profit of RM 8.0 million for the fiscal year ending December 31, 2012. The favorable operating performances were attributable to the companies’ enhanced underwriting risk management and consistently positive investment results. Asia Capital Re and ACRM’s risk-adjusted capitalization is expected to be adequate in the near to midterm and is supportive of their current ratings.
Offsetting these positive rating factors are the companies’ volatile historical underwriting results and the competitive reinsurance market in the Asia-Pacific region.
In view of the volatile historical underwriting results, the companies have enhanced their underwriting risk management through stricter risk selection and more rigorous portfolio management. Nonetheless, competition from existing reinsurers and new entrants to the Asia-Pacific reinsurance market remains a challenge. A.M. Best will continue to closely monitor the effectiveness of the companies’ risk management measures and the financial performances of their operations against their stated business plans.
Future positive rating actions could occur if the companies further improve their risk-based capitalization and demonstrate the ability to achieve a consistently favorable operating performance. Conversely, negative rating actions could occur if the companies’ operating performances materially deviate from their projections, or their risk-adjusted capitalization levels decline below A.M. Best’s expectations.
The methodology used in determining these interactive ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
Ratings are communicated to rated entities prior to publication, and unless stated otherwise, the ratings were not amended subsequent to that communication.
A.M. Best Asia-Pacific Limited is a subsidiary of A.M. Best Company. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
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