AM Best Revises Issuer Credit Rating Outlook to Positive for Arab Reinsurance Company SAL

LONDON--(BUSINESS WIRE)--AM Best has revised the outlook to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B (Fair) and the Long-Term ICR of “bb” (Fair) of Arab Reinsurance Company SAL (Arab Re) (Lebanon). The outlook of the FSR is stable.

These Credit Ratings (ratings) reflect Arab Re’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management (ERM).

The revision of the Long-Term ICR outlook reflects positive pressures across Arab Re’s balance sheet strength and ERM assessments following the decision by the company’s management to de-risk its investment portfolio. Arab Re has signed an agreement to sell its material land holding in Lebanon, with the transaction expected to be completed by December 2028. In AM Best’s view, the sale of this land, which comprised 17% of Arab Re’s total investments at year-end 2024, will materially reduce the company’s asset risk and significantly benefit its risk-adjusted capitalisation over the medium term, as measured by Best’s Capital Adequacy Ratio (BCAR). This disposal should also contribute to further insulating Arab Re from the challenging economic and political conditions in Lebanon.

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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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