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FOR IMMEDIATE RELEASE
SINGAPORE - JULY 06, 2018 10:12 AM (EDT)
A.M. Best has placed under review with developing implications the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Rating of “aa-” of Sovereign Assurance Company Limited (Sovereign) (New Zealand).
These Credit Rating (rating) actions follow an announcement on July 2, 2018, that AIA International Limited (AIAI), a wholly owned subsidiary of AIA Group Limited (the AIA group), has completed its acquisition of Sovereign from the Commonwealth Bank of Australia (Commonwealth Bank). AIAI and the Commonwealth Bank originally entered into a sale agreement in September 2017, with the latest announcement following necessary regulatory approvals being granted and the transfer of ownership of Sovereign to AIAI, through the purchase of the entire share capital of its intermediate holding company, ASB Group (Life) Limited. The transaction also marks the commencement of a 20-year strategic bancassurance partnership between the AIA group and ASB Bank Limited, a wholly owned subsidiary of the Commonwealth Bank.
The ratings have been placed under review with developing implications while A.M. Best assesses the impact of the change in ownership. Among other factors, A.M. Best will need to consider the planned integration of Sovereign within the AIA group, any expected changes in strategy, and any implicit or explicit support to be afforded to Sovereign by the AIA group. A.M. Best also will give consideration to the fundamentals of the AIA group and any impact this has on the ratings of Sovereign.
A.M. Best expects to resolve the under review status following the conclusion of its assessment.
Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.
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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