Sri Lanka Insurance ‘BB-‘ rating confirmed

Mar 26, 2014 (LBO) – Fitch Ratings has confirmed a ‘BB” issuer financial strength rating of Sri Lanka Insurance Corporation with a stable outlook. Fitch said it had a franchise built up since 1961 and an asset base of over 140 billion rupees.

It was the market leader in non-life insurance taking 23 percent of gross written premium and was the second largest in the non-life category.

But the strengths were balanced by significant investments in non-core subsidiaries made according to state directions and a large equity portfolio, which weakened SLIC risk-based capital.

The full statement is reproduced below:-

Fitch Affirms Sri Lanka Insurance Corporation at IFS ‘BB-‘/Stable

Fitch Ratings-Colombo/Hong Kong-25 March 2014: Fitch Ratings Lanka has affirmed Sri Lanka Insurance Corporation Limited’s (SLIC) Insurer Financial Strength rating (IFS) at ‘BB-‘ with a Stable Outlook. The agency has also affirmed the National Insurer Financial Strength Rating and National Long-Term rating at ‘AA(lka)’ with a Stable Outlook.

KEY RATING DRIVERS

The ratings reflect SLIC’s solid franchise and market position; and he