AM Best


A.M. Best Assigns Ratings to Bankers Assurance S.A.L.


CONTACTS:

Ghislain Le Cam, CFA
Senior Financial Analyst
+(44) 20 7397 0268
ghislain.lecam@ambest.com

Mahesh Mistry
Director, Analytics
+(44) 20 7397 0325
mahesh.mistry@ambest.com

Rachelle Morrow
Senior Manager, Public Relations
+(1) 908 439 2200, ext. 5378
rachelle.morrow@ambest.com

Jim Peavy
Assistant Vice President, Public Relations
+(1) 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

LONDON - APRIL 11, 2014 09:58 AM (EDT)
A.M. Best has assigned a financial strength rating of B++ (Good) and issuer credit rating of "bbb" to Bankers Assurance S.A.L. (Bankers) (Lebanon). The outlook assigned to both ratings is stable.

The ratings reflect Bankers' strong risk-adjusted capitalisation, solid technical performance and good market position in Lebanon. An offsetting rating factor is the economic and political risk associated with Lebanon.

Bankers' risk-adjusted capitalisation remains strong. In 2012, its capital position marginally reduced following the first payment of a dividend in several years. However, risk-adjusted capitalisation rebounded in 2013, driven by strong earnings. The company's prospective capital position is expected to remain supportive of the current rating level with internal capital generation sufficient to absorb projected growth.

Bankers has exhibited solid technical performance with a five-year average combined ratio below 89%. The company produced a technical profit of LLP 13.2 billion (USD 8.9 million) in 2013, with a loss ratio of 54%, compared to 59% in 2012. The improvement in underwriting performance was mainly driven by stricter technical discipline with the non-renewal of underperforming medical business.

Bankers has a leading market franchise in its domestic market, with a diversified portfolio covering both life and non-life business segments. Bankers is the main insurance arm of Nasco Insurance Group Limited.

The ratings of Bankers also factor in the high financial system and political risks associated with operating within Lebanon.

Upward rating movement for Bankers is unlikely in the near term. Downward rating pressure could occur if Bankers' risk-adjusted capitalisation were to decrease to a level not supportive of the current ratings, from a prolonged deterioration in operating performance, or due to an increase in the level of political and economic risk in Lebanon.

The methodology used in determining these 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.

In accordance with Regulation (EC) No. 1060/2009, the following is a link to required disclosures: A.M. Best Europe - Rating Services Limited Supplementary Disclosure.

This rating announcement has been issued by A.M. Best Europe - Rating Services Limited, which 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.


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