KUALA LUMPUR, Dec 4 -- AM Best has affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of ‘a-’ of Labuan Reinsurance (L) Ltd (Labuan Re) Malaysia.
According to a statement, the outlook of these Credit Ratings (ratings) is negative.
The ratings reflect Labuan Re’s balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
Labuan Re’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation that is expected to remain at the strongest level over the medium term, as measured by Best’s Capital Adequacy Ratio.
The global credit rating agency, AM Best views Labuan Re’s operating performance as adequate, albeit the continued negative outlook for the FSR and Long-Term ICR reflects pressure on this assessment.
Prospectively, AM Best expects Labuan Re to continue to execute remedial actions, which are aimed at enabling technical and operating profitability over the near term. AM Best does, however, continue to note that challenges remain in executing on this business plan given a persisting competitive operating environment.
Over the medium term, AM Best expects the company to exhibit a declining trend in gross written premium, as it continues to embark on a voluntary retrenchment of unprofitable business and scale back its participation in Lloyd’s of London syndicates.
For details, visit www.ambest.com.
-- BERNAMA
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