The ratings and positive outlook reflect Nacional’s excellent risk-adjusted capitalisation, strong operating performance and well-established business profile as a leading reinsurer in
Nacional’s risk-adjusted capitalisation has improved each year between 2011 and 2015, supported by strong earnings generation and a comprehensive retrocession programme. The reinsurer has been de-risking its investment portfolio over the past few years. As a result, exposure to Spanish sovereign and the corporate debt of financial institutions diminished to 11% of total investments at year-end 2015, down from 27% in 2011. Nacional’s capital levels are likely to continue benefitting from high earnings retention going forward, underpinned by a relatively prudent dividend policy that supports a payout ratio of approximately 30% of profit after tax.
Nacional’s disciplined underwriting approach and limited exposure to natural catastrophes have contributed to solid technical results over the past five years, with a weighted average combined ratio below 94%. The company reported its highest net profit to date of
Nacional maintains a strong competitive position as the leading independent reinsurer in
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