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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JANUARY 04, 2012 12:00 AM (EST)
A.M. Best Co. has affirmed the financial strength ratings of A- (Excellent) and the issuer credit ratings (ICR) of "a-" of Asia Capital Reinsurance Group Pte. Ltd. (ACR) (Singapore), Asia Capital Reinsurance Malaysia Sdn Bhd (ACRM) (Malaysia), ACR ReTakaful SEA Berhad (ACR ReTakaful SEA) (Malaysia) and ACR ReTakaful MEA B.S.C. (c) (ACR ReTakaful MEA) (Bahrain). A.M. Best also has affirmed the ICRs of "bbb-" of ACR Capital Holdings Pte. Ltd. (ACR Holdings) (Singapore) and ACR ReTakaful Holdings Limited (United Arab Emirates). The outlook for all ratings is stable.
The rating actions reflect ACR, ACRM, ACR ReTakaful SEA and ACR ReTakaful MEA's adequate capitalization, geographically diversified underwriting portfolio and conservative investment practice. A.M. Best also acknowledges the companies' prudent reserving practice.
As demonstrated by Best's Capital Adequacy Ratio, ACR, ACRM, ACR ReTakaful SEA and ACR ReTakaful MEA's risk-adjusted capitalization levels are expected to remain adequate for fiscal year 2011, despite the losses from the catastrophes that occurred in 2011. However, if the losses from the Thai flooding were to increase and if the actual performances of the companies were to deviate from the provided projections, A.M. Best may revise its opinion on the companies' financial strength and enterprise risk management.
ACR, ACRM, ACR ReTakaful SEA and ACR ReTakaful MEA have diversified underwriting books geographically. This is partially attributable to the intercompany retrocession arrangement between all the operating entities. ACRM, ACR ReTakaful SEA and ACR ReTakaful MEA also have technical support from ACR, resulting in similar underwriting, claims management and investment guidelines and practices within the group.
Partially offsetting these positive rating factors are the companies' short operating history and the potential challenges to achieve targeted profitability levels due to the competitive environment in which the companies operate.
The principal methodology used in determining these ratings is Best's Credit Rating Methodology - Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best's rating process and highlights the different rating criteria employed. Additional key criteria utilized include: "Understanding Universal BCAR"; "Catastrophe Analysis in A.M. Best Ratings"; "Rating Members of Insurance Groups"; "Assessing Country Risk"; and "Risk Management and the Rating Process for Insurance Companies." Methodologies can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.