AM Best has affirmed the Financial Strength Rating of B+ (good) and the Long-Term Credit Issuer Rating of bbb- (good) of the Lebanese reinsurer Arab Re. The outlook of both ratings remains negative.
For AM Best, these ratings reflect the stability of the Lebanese reinsurer's balance sheet, its good capitalization and the high level of its shareholder's equity.
Still according to the rating agency, Arab Re has long been working in a niche whose results are positive. Over the last five years (2014-2018), the return on equity amounted 4%, while the return on written premiums was of 8.3%.
The negative outlook of both ratings reflects the political and economic uncertainties of the Arab countries, the reinsurer's main markets. In addition, Arab Re will, in the short to medium term, witness a pressure on reinsurance rates caused by the strong competition in the region.
The premiums underwritten by Arab Re in 2018 amounted to 67.9 million USD, an increase of 6% compared with last year.
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