Global Arab Network | Bahrain Kuwait Insurance Co. Ratings Placed On CreditWatch Negative

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Bahrain Kuwait Insurance Co. Ratings Placed On CreditWatch Negative

Global Arab Network - - Gamal Ragay

Friday, 25 February 2011 00:47

Bahrain Kuwait Insurance Co. Ratings Placed On Credit Watch Negative

Standard & Poor's Ratings Services said that it placed its 'BBB' long-term counterparty credit and insurer financial strength ratings, and its 'gcAA-' regional credit rating scale for the Gulf Cooperation Council, on Bahrain-based insurer Bahrain Kuwait Insurance Co. BSC (BKIC), on CreditWatch with negative implications, Global Arab Network reports according to a press statement.

This rating action follows the recent downgrade of the long-term local currency sovereign rating on the Kingdom of Bahrain. Under our ratings criteria, sovereign risk is a key factor influencing the financial strength of insurers. As a result, the vast majority of insurers are rated no higher than the relevant sovereign local currency rating. Consequently, we have placed the ratings on BKIC on CreditWatch with negative implications to reflect the increase in sovereign-related risk.

The majority of BKIC's premium emanates from Bahrain and most of its invested assets are held in the Kingdom. Therefore, its business and financial profile is affected by movements in the sovereign rating. Standard & Poor's aims to resolve the CreditWatch listing on BKIC within the next three months, pending a resolution of the CreditWatch listing on Bahrain.

Global Arab Network

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Last Updated on Saturday, 05 March 2011 12:55

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