AM Best Downgrades Credit Ratings of Saudi Arabian Insurance Company B.S.C. (c); Places Credit Ratings Under Review With Negative Implications

AM Best has downgraded the Financial Strength Rating to B+ (Good) from B++ (Good) and the Long-Term Issuer Credit Rating to “bbb-” (Good) from “bbb” (Good) of Saudi Arabian Insurance Company B.S.C. (c) (Damana) (Bahrain). In addition, AM Best has placed these Credit Ratings (ratings) under review with negative implications.

The ratings reflect Damana’s balance sheet strength, which AM Best assesses as very strong, as well as its marginal operating performance, limited business profile and marginal enterprise risk management (ERM).

The rating downgrades reflect AM Best’s revised assessment of Damana’s ERM capabilities and governance framework. In particular, AM Best has concerns regarding the company’s ability to effectively manage its investment and liquidity risk, and the resulting implications for risk-adjusted capitalisation. In addition, Damana has not yet released audited financial statements for 2020, creating concern over governance and internal controls. AM Best is closely monitoring the situation as the company seeks to remove the uncertainty around liquidity and risk-adjusted capitalisation, while working with its auditors for the release of the 2020 financial statements.

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 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
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