A.M. Best Affirms Credit Ratings of Bankers Assurance S.A.L.

LONDON--(BUSINESS WIRE)-- A.M. Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” of Bankers Assurance S.A.L. (Bankers) (Lebanon). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Bankers’ balance sheet strength, which A.M. Best categorises as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management (ERM).

Bankers’ risk-adjusted capitalisation at year-end 2017, as measured by Best's Capital Adequacy Ratio (BCAR), was assessed as strongest. A.M. Best anticipates prospective risk-adjusted capitalisation to remain at the strongest level over the medium term, supported by a prudent dividend policy enabling good internal capital generation. The balance sheet strength assessment also reflects the company’s conservative and highly liquid investment portfolio and its low dependence on reinsurance support. Offsetting the balance sheet strength assessment is the concentration of investments in Lebanon, which introduces potential volatility in the risk-adjusted capitalisation given the associated elevated levels of economic and financial system risk in the country.

Bankers is a member of Nasco Insurance Group Limited (Nasco), a diverse insurance, reinsurance and insurance related services group with operations across Europe and the Middle East. A.M. Best considers the holding company assessment of Nasco as neutral on Bankers’ balance sheet strength assessment.

Bankers has a track record of strong operating performance and a good balance of earnings between underwriting and investment returns, with the company reporting a five-year average (2013-2017) return on equity of 16.1%. Strong technical performance is underpinned by the company’s non-life operation, which has returned a five-year average (2013-2017) combined ratio of 93.1%.

Bankers’ limited business profile is supported by its good local market position as the third largest insurer in Lebanon, with a leading position in the non-life segment based on an estimated market share of 9.5% in 2017. The company benefits from a diversified underwriting portfolio by product, across both the life and non-life segments, and established distribution channels. Bankers operates solely in Lebanon, and the assessment factors in the company’s geographically concentrated business profile and exposure to the highly competitive and fragmented local market.

Bankers’ operations in Lebanon also expose the company to heightened levels of economic, political and financial system risks. Despite the company’s track record of strong operating performance in challenging market conditions, the potential for significant business disruption and volatility remains elevated. A.M. Best will continue to monitor developments in Lebanon and assess any impact on the company.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

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A.M. Best

Alex Rafferty, ACA, +44 20 7397 0285

Senior Financial Analyst

[email protected]

or

Christopher Sharkey, +1 908 439 2200, ext. 5159

Manager, Public Relations

[email protected]

or

Ghislain Le Cam, CFA, FRM, +44 20 7397 0268

Director, Analytics

[email protected]

or

Jim Peavy, +1 908 439 2200, ext. 5644

Director, Public Relations

[email protected]

Source: A.M. Best