Sagicor gets top rating from CariCRIS

Wednesday, March 13, 2019

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CARIBBEAN Information and Credit Rating Services Limited (CariCRIS) has reaffirmed the rating of jmAAA for Sagicor Life Jamaica Limited (SLJ) on its debt issue of US$75 million.

The rating indicates that Sagicor's creditworthiness to the US$75 million obligation, adjudged in relation to other obligations within Jamaica is the highest.

According to a statement from CariCRIS, the rating includes a credit uplift for implied support from SLJ's parent company, Sagicor Financial Corporation (SFC), through its controlling interest in Sagicor Group Jamaica Limited (SGJ).

“The rating continues to be supported by overall financial stability, continued healthy profitability and improved financial strength, as measured by its strong capitalisation level, in excess of the regulatory requirement,” CariCRIS said.

The rating agency, however, warned that these supporting factors are tempered by SLJ's significant business and financial exposure to the highly indebted Jamaican economy.

“In addition, the protracted low interest rate environment in Jamaica has the potential to challenge SLJ's ALM position going forward, thereby adversely impacting its long-term business,” it said.

Nonetheless, CariCRIS maintained a stable outlook on the ratings, reflective of the company's market leadership in the Jamaican insurance industry.

“The stable outlook is based on CariCRIS' expectation that SLJ will likely have a steady and predictable revenue stream with modest growth over the next 12 months, consistent with its 3-year trend.

“We expect the company to continue to perform well, driven primarily by its overall leading market position in the insurance industry in Jamaica,” the rating agency said.

Efforts by the Jamaica Observer to get a statement from the company proved unsuccessful up to press time.

SLJ remains the largest life insurance company in Jamaica with significant market shares in several segments of the market. In addition, its established brand equity underpinned by a comprehensive suite of products and services, and supported by a strong distribution network, has enabled the company to consistently achieve a healthy financial performance.

— Karena Bennett

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