AM Best Revises Under Review Status to Negative for Credit Ratings of Solidarity Bahrain B.S.C.

LONDON--(BUSINESS WIRE)--AM Best has revised the implications of the under review status to negative from developing for the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good) of Solidarity Bahrain B.S.C. (Solidarity Bahrain) (Bahrain).

The Credit Ratings (ratings) reflect Solidarity Bahrain’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The ratings also consider, in the form of lift, Solidarity Bahrain’s strategic importance to its parent company, Solidarity Group Holding BSC (c).

The ratings were first placed under review with developing implications following the announcement of the acquisition of Bahrain National Insurance B.S.C. (c) (BNI) and Bahrain National Life Assurance Company B.S.C. (c) (BNL) for a total purchase price of BHD 75 million. The acquisition resulted in a goodwill of BHD 30.6 million.

The revision in implications of the under review status to negative from developing reflects the execution risk surrounding the remediation plan in response to deterioration of the company’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), following the consolidation of BNI and BNL.

The ratings are expected to remain under review with negative implications until the successful completion of the strategic plan.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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