S&P has a gloomy outlook for Chinese insurer

S&P has a gloomy outlook for Chinese insurer: "US ratings agency Standard & Poor's Ratings Services has placed its 'BBB-' long-term and 'A-3' short-term counterparty credit ratings on China Insurance International Holdings Co. Ltd. (CIIH) and the 'BBB-' issue rating on the company's senior unsecured debt on CreditWatch with negative implications.

At the same time, Standard & Poor's also placed its 'A-' long-term counterparty credit and insurer financial strength ratings on China International Reinsurance Co. Ltd. (CIRe) on CreditWatch with negative implications.

'The CreditWatch actions follow the group's recent profit announcement and reflect the risks stemming from the deterioration in the group's capitalization as a result of losses made in 2008,' S&P said. It added that 'there is some uncertainty about the group's likely earnings performance over the next two years, given the currently volatile market conditions and the rapid growth of the group's operations in China.'

S&P said that CIIH's operating performance in fiscal 2008 was weaker than expected despite its profit warning a month ago. The insurer reported a loss attributable to shareholders of Hong Kong dollar (HK$) 299.715m."

For Source and Full Article Visit: Reinsurance Magazine