Fitch changes rating on AzInsurance

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# 07:46
23 December 2016

Fitch Ratings has downgraded AzInsurance OJSC's Insurer Financial Strength (IFS) rating to 'B' from 'B+'. The Outlook is Stable.

 

The downgrade reflects AzInsurance's weakened business profile and Fitch's expectations that this will not recover significantly in 2017. The downgrade also reflects the company's sharply lower operating profitability in 9M16 and continuing high investment risk. The rating also takes into account the company's practice of very high profit distributions to the shareholder.

 

In 9M16, AzInsurance's total gross written premiums (GWP) decreased by 34% compared with 9M15 in the context of the worsened macroeconomic environment in Azerbaijan. Further weakening of AzInsurance's business profile as measured by its market share and business mix, or capital depletion due to investment losses, could result in a downgrade.

 

A significant recovery in AzInsurance's business profile and operating performance could lead to an upgrade, providing also that the quality of the investments does not weaken.

 

 

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THE OPERATION IS BEING PERFORMED