swiss-re-pic-resized-1
Source: Swiss Re
8 August 2018Insurance

S&P warns on Swiss Re ReAssure ratings as parent ponders IPO

S&P Global Ratings has placed the 'A-' ratings of Swiss Re ReAssure (SRRAL) on Credit Watch Negative, following the announcement by its parent Swiss Re Group that it is exploring the possibility of an  initial public offering (IPO) of the UK closed-book consolidator ReAssure (not rated).

ReAssure is one of the main operating entities of the Swiss Re Life Capital (SRLC) business unit, which S&P said it considers to be highly strategic to the Swiss Re Group.

“We understand that, following any potential IPO, the remaining business will comprise ElipsLife and IptiQ (which are both relatively small primary life insurers) and Swiss Re's share in SRRAL. Following Friday's announcement, we expect to review the group status of the SRLC. At this stage, we believe it is unlikely that we will continue to view the business unit as highly strategic following our review,” S&P said in a statement.

SRRAL is an intermediate nonoperating holding company in the SRLC business unit. S&P said the rating of SRRAL is dependent on its assessment of the business unit's group status. “We therefore placed the ratings on SRRL on CreditWatch negative,” it said.

It also placed the ratings on the €750 million 1.375% senior debt instrument due in 2023 issued by SRRAL on CreditWatch developing.

The rating agency added: “The negative CreditWatch on SRRAL reflects our view that the SRLC business unit, of which SRRAL is a part, is unlikely to remain highly strategic to the Swiss Re Group following the IPO of the ReAssure business. If we view the business unit as strategically important, and if we view its stand-alone credit profile (SACP) as 'bbb+' or higher, then we would affirm the ratings on SRRAL at 'A-'. However, if the group status is less than strategically important, or if the SACP is 'bbb' or lower, then we could lower the rating on SRRAL by one or more notches.”

Get all the latest re/insurance industry news with our daily newsletter -  sign up here.

More of today's news

Munich Re shrinks reinsurance business in Q2

Aspen elevates CUO to lead reinsurance as CEO Lillelund resigns

Travelers replaces CFO as Benet steps down from top position

Aegon sells remaining US life reinsurance business to SCOR

Zurich reveals new Canada CEO, chief agent

Munich Re grows 42% at July renewals

Revenues up at White Mountains but profits dip

Hastings Group overcomes hurdles to post strong H1 results

Don't miss our insurtech email newsletter - sign up today

Already registered?

Login to your account

To request a FREE 2-week trial subscription, please signup.
NOTE - this can take up to 48hrs to be approved.

Two Weeks Free Trial

For multi-user price options, or to check if your company has an existing subscription that we can add you to for FREE, please email Elliot Field at efield@newtonmedia.co.uk or Adrian Tapping at atapping@newtonmedia.co.uk


More on this story

News
15 August 2018   Reinsurers have embraced third-party capital through instruments like sidecars, collateralized reinsurance, and catastrophe bonds and the retrocession market increasingly depends on this convergence capital, a new report by S&P Global Ratings states.
Insurance
11 July 2019   Zurich-based reinsurer Swiss Re has suspended its previously announced initial public offering (IPO) of UK closed life book business ReAssure citing weak investor demand and market conditions.
Insurance
17 July 2019   S&P Global Ratings has said that its 'A-' ratings on Swiss Re ReAssure (SRRAL) will remain on Credit Watch with negative implications following the suspension of its initial public offering (IPO) on July 11.