AM Best Downgrades Credit Ratings of Russian Reinsurance Company JSC and Maintains Under Review With Negative Implications Status
AM Best has downgraded the Financial Strength Rating to B- (Fair) from B (Fair) and the Long-Term Issuer Credit Rating to “bb-” (Fair) from “bb+” (Fair) of Russian Reinsurance Company JSC (Russian Re) (Russia). Concurrently, AM Best has maintained the under review with negative implications status for these Credit Ratings (ratings).
The ratings reflect Russian Re’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management.
The rating downgrades reflect deterioration in the company’s balance sheet strength due to heightened geopolitical, economic and financial system risk in Russia, and takes into consideration the impact of inflation on the adequacy of reserves, liquidity constraints and the company’s dependence on foreign reinsurers.
The ratings remain under review with negative implications as AM Best is closely monitoring the severity of the impact of sanctions, and the broader international response to the conflict in Ukraine, on Russia’s economy and financial system, and subsequent consequences for the credit profile of Russian Re. Balance sheet and operational concerns stem from business transacted in foreign currencies and potential issues recovering claims from foreign reinsurers.
This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. 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 specialising 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. For more information, visit www.ambest.com.
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Anna Sheremeteva
Financial Analyst
+44 20 7397 4397
anna.sheremeteva@ambest.com
Catherine Thomas, CFA
Senior Director, Analytics
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