AM Best


SEPTEMBER 09, 2022 01:14 PM (EDT)

AM Best Places Credit Ratings of Mercantil Seguros y Re and Mercantil Re Internacional Under Review with Negative Implications


CONTACTS:
 Salvador Smith
Senior Financial Analyst
+52 55 1102 2720, ext. 109
salvador.smith@ambest.com

Alfonso Novelo
Senior Director, Analytics
+52 55 1102 2720, ext. 107
alfonso.novelo@ambest.com
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jeff Mango
Managing Director, Strategy & Communications
+1 908 439 2200, ext. 5204
jeffrey.mango@ambest.com

FOR IMMEDIATE RELEASE

MEXICO CITY - SEPTEMBER 09, 2022 01:14 PM (EDT)
AM Best has placed under review with negative implications the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” (Good) of Mercantil Seguros y Reaseguros, S.A. (Mercantil Seguros) and Mercantil Reaseguradora Internacional, S.A. (Mercantil Re) (both domiciled in Panama).

These rating actions follow the announcement that the group’s intermediate holding company, Mercantil Holding Financiero Internacional, S.A., has acquired Capital Bank, Inc. and its subsidiaries in Panama, including insurer Optima Compañia de Seguros S.A. Mercantil Holding Financiero Internacional, S.A. runs the group’s international operations and is controlled by ultimate parent Mercantil Servicios Financieros Internacional.

AM Best expects the transaction to expand the group´s domestic footprint in Panama’s insurance and financial services industries. The under review with negative implications status pertains to the uncertain impacts on Mercantil Seguros and Mercantil Re´s balance sheet strength assessments, as well as integration risk. AM Best will continue to monitor the transaction as it evolves and receives customary regulatory approvals.

The methodology used in determining these ratings is Best’s Credit Rating Methodology (Version Nov. 13, 2020), which provides a comprehensive explanation of AM 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 .

Key insurance criteria reports utilized:


  • Available Capital & Holding Company Analysis (Oct. 13, 2017)

  • Catastrophe Analysis in AM Best Ratings (Version Oct. 13, 2017)

  • Evaluating Country Risk (Version Oct. 13, 2017)

  • Scoring and Assessing Innovation (Version March 5, 2020)

  • Understanding Universal BCAR (Version June 30, 2022)

View a general description of the policies and procedures used to determine credit ratings. For information on the meaning of ratings, structure, voting and the committee process for determining the ratings and monitoring activities, please refer to Guide to Best’s Credit Ratings.


  • Previous Rating Date: Aug. 19, 2022

  • Date Range of Financial Data Used: Dec. 31, 2016-Aug. 31, 2022

This press release relates to rating(s) that have been published on AM Best’s website. For additional 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 AM Best’s Recent Rating Activity web page.

AM Best does not validate or certify the information provided by the client in order to issue a credit rating.

While the information obtained from the material source(s) is believed to be reliable, its accuracy is not guaranteed. AM Best does not audit the company’s financial records or statements, or otherwise independently verify the accuracy and reliability of the information; therefore, AM Best cannot attest as to the accuracy of the information provided.

AM Best’s credit ratings are independent and objective opinions, not statements of fact. AM Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. AM Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. View our entire notice for complete details.

AM Best receives compensation for interactive rating services provided to organizations that it rates. AM Best may also receive compensation from rated entities for non-rating related services or products offered by AM Best. AM Best does not offer consulting or advisory services. For more information regarding AM Best’s rating process, including handling of confidential (non-public) information, independence, and avoidance of conflicts of interest, please read the AM Best Code of Conduct. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.


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