AM Best Comments on Credit Ratings of Sagicor Financial Corporation Limited and Sagicor Life Inc. Following Announced Acquisition Agreement
October 23, 2019 by A.M. Best
OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has commented that the Credit Ratings (ratings) of Sagicor Financial Corporation Limited (SFC) (Bermuda) and its subsidiary, Sagicor Life Inc. (Sagicor) (St. Michael, Barbados), remain unchanged following the announcement that Sagicor has entered into an agreement to acquire approximately USD 1.2 billion of life, annuity and health liabilities of Colonial Life Insurance Company (Trinidad) Limited (CLICO) (Trinidad) and British American Insurance Company Trinidad Limited (BAT) (Trinidad). These portfolios were held under the control of the Central Bank of Trinidad and Tobago under certain special powers of the Central Bank Act. These liabilities are a combination of universal life, whole life, term life, annuities, group life, health and creditor policies. As part of this announced deal, Sagicor will receive approximately USD 1.2 billion in assets, which matches the anticipated amount of liabilities.
While the impact to Sagicor’s balance sheet is material given the size of the acquired blocks, AM Best notes that the company’s risk-adjusted capitalization will remain supportive of its current ratings. AM Best expects that the transaction will add a moderate amount of income to operating earnings. Financial leverage and interest coverage should remain within AM Best’s expectations for the current rating levels. The transaction is expected to close in 2020, pending regulatory approval and other customary closing conditions.
Sagicor Life Inc. has a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “a-”. Its ultimate parent, Sagicor Financial Corporation Limited has a Long Term ICR of “bbb-”. The outlook of these ratings remains stable.
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 Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media – Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
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