A.M. Best Comments on Credit Ratings of China Reinsurance (Group) Corporation and Its Subsidiaries Following Disclosure on Introduction of Strategic Investors

HONG KONG--()--A.M. Best has commented that the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings of “a” of China Reinsurance (Group) Corporation (China Re) and its subsidiaries, China Property & Casualty Reinsurance Company Ltd., China Life Reinsurance Company Ltd. and China Continent Property & Casualty Insurance Company Ltd. (CCIC), remain unchanged following the disclosure on the introduction of strategic investors through CCIC’s capital increase announced on March 28, 2018, and April 2, 2018.

China Re’s board of directors has entered into a share subscription agreement, effective on April 2, 2018, between CCIC and its existing shareholder, Ningbo Development & Investment Group Co., Ltd., as well as new strategic investors, namely, Jiangsu Yunshan Capital Management Co., Ltd., CES Capital Holdings Co., Ltd., CEA Industry Investment Co., Ltd., New China Life Insurance Company, Limited, Shanghai SAIC Qixiang Investment Partnership (Limited Partnership), Xiamen CICC Qitong Investment Partnership (Limited Partnership), CGT Investment Management Co., Ltd., and Beijing NavInfo Co., Ltd. This share subscription agreement calls for the issuance of 4.7 billion new shares at RMB 2.28 per share for a total of RMB 10.7 billion (US$ 1.7 billion) (the capital increase). The amount of new capital is equivalent to approximately 14% of China Re’s consolidated net assets as of Dec. 31, 2017. The share subscription agreement is subject to regulatory approval. Immediately after the capital increase, China Re’s shareholding percentage of CCIC will be diluted to 64.30% from 93.18%.

A.M. Best expects the capital increase to continue to support China Re’s consolidated risk-adjusted capitalization in the medium term at current rating level. Moreover, the strategic cooperation with the new investors is expected to enhance CCIC’s business growth and portfolio diversification potential, strengthen distribution network and promote innovation.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

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Contacts

A.M. Best
Christie Lee
Director, Analytics
+852 2827 3413

christie.lee@ambest.com
or
John Andre
Managing Director, Analytics
+1 908 439 2200, ext. 5619

john.andre@ambest.com
or
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com
or
Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644

james.peavy@ambest.com

Contacts

A.M. Best
Christie Lee
Director, Analytics
+852 2827 3413

christie.lee@ambest.com
or
John Andre
Managing Director, Analytics
+1 908 439 2200, ext. 5619

john.andre@ambest.com
or
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com
or
Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644

james.peavy@ambest.com