Emeritus Reinsurance Company Limited

Image placeholder
Emeritus Reinsurance Company Limited (2022-03)
  • Emeritus Reinsurance Company Limited
  • Year : Mar 2022
3 Tokens
USD 300.00
Summary

Emeritus Re Malawi reined in solvency pressures from growing aged receivables, with the balance aged above 180 days reducing to below MWK441m (FY19: MWK531m) from around MWK1bn in the FY16-FY18 period. Accordingly, an improvement in risk absorbing capital, further buttressed by cumulative review period net profits of close to MWK1bn and a conservative profit retention ratio of c.80%, levered risk adjusted capitalisation to 2.1x (FY19: 1.7x), from 1x at FY18. We believe progressive growth in the capital base to USD3.8m (versus USD2.4m at the start of the review period) reduces risk of reversal in the solvency trend, while a fair track record in credit control over the past two years, balanced by risks in the operating environment, gives a degree of comfort that solvency levels could be managed within a 1.3x to 2.0x range over the medium term.

Additional Information

The Positive Outlook on the national scale rating reflects potential for risk adjusted capitalisation to be sustained above 1.5x over the outlook horizon, due to enhanced institutional measures to improve premium collections as well as regulatory efforts to reduce systematic risks from credit exposures. With respect to the national scale rating, positive action could follow the stabilisation of the GCR Capital Adequacy Ratio (“GCR CAR”) at levels comfortably above 1.5x, while current liquidity and earnings strength is maintained.

Related Publication

Nico General Insurance Company Ltd (2017-11)

A Credit Rating report is a research report providing detailed analysis utilised by GCR in the accordance of a Credit Rating.

Emeritus Reinsurance Company Limited (2022-03)

Emeritus Re Malawi reined in solvency pressures from growing aged receivables, with the balance aged above 180 days reducing to below MWK441m (FY19...

Credit Spotlight: Additional Considerations for Rating Islamic Finance Institutions and Sukuk

GCR’s ratings on Islamic Finance institutions (IFI) and sukuk are not subject to distinct ratings criteria, despite very specific features. O...

Available Purchase Options: