Fitch Affirms Balboa Re's Rating at 'BBB+'; Outlook Stable

NEW YORK--()--Fitch Ratings has affirmed Balboa Reinsurance Ltd.'s (Balboa Re) International Insurer Financial Strength Rating (IFS) at 'BBB+'. The Rating Outlook is Stable. The Citigroup announcement to exit its retail banking and insurance operations in 11 countries, has no immediate impact on the international rating assigned by Fitch to its captive reinsurance company Balboa Re.

KEY RATING DRIVERS

After the announcement, Fitch changed its view on the strategic importance Balboa Re has for Citigroup. Fitch believes that currently this subsidiary has 'limited importance' to its shareholder, without affecting however Fitch's view of the rating assigned.

The rating of Balboa Re is based on the ability and willingness of the company's ultimate parent, Citigroup Inc. (Citigroup) to provide support when needed. Fitch thinks that Citigroup has the ability to financially support Balboa Re, and the willingness to do so, will remain unchanged, while the ownership of this reinsurance operation is maintained. Thus, the agency believes that the support of Citigroup will remain while Balboa Re maintains synergies and is owned by this group.

RATING SENSITIVITIES

The rating may change if Balboa Re is sold to investors with different credit profiles than the current parent. In that scenario, Fitch will evaluate the potential support from its new shareholders.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Insurance Rating Methodology' (Sept. 4, 2014);

--'Rating FI Subsidiaries and Holding Companies' (Aug. 10, 2012)

Applicable Criteria and Related Research:

Insurance Rating Methodology

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=756650

Rating FI Subsidiaries and Holding Companies

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679209

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=903374

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Contacts

Fitch Ratings
Primary Analyst
Franklin Santarelli
Managing Director
+1-212-908-0739
franklin.santarelli@fitchratings.com
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Milena Carrizosa
Director
+57 1 326-9999 ext 1090
or
Committee Chairperson
Rene Medrano
Senior Director
or
Media Relations:
Brian Bertsch, +1-212-908-0549 (New York)
brian.bertsch@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Franklin Santarelli
Managing Director
+1-212-908-0739
franklin.santarelli@fitchratings.com
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Milena Carrizosa
Director
+57 1 326-9999 ext 1090
or
Committee Chairperson
Rene Medrano
Senior Director
or
Media Relations:
Brian Bertsch, +1-212-908-0549 (New York)
brian.bertsch@fitchratings.com