KUALA LUMPUR, April 2 (Bernama) -- AM Best has downgraded the Financial Strength Rating to B- (Fair) from B (Fair) and the Long-Term Issuer Credit Rating to ‘bb-’ from ‘bb’ of Lifetime Income Limited (LIL) New Zealand.
According to a statement, AM Best concurrently maintained the under review with negative implications status for these Credit Ratings (ratings).
The ratings reflect LIL’s balance sheet strength, which AM Best assesses as adequate, as well as its marginal operating performance, very limited business profile and marginal enterprise risk management.
These ratings were placed under review with negative implications on Nov 5, 2020, following regulatory licence conditions imposed on the company by the Reserve Bank of New Zealand (RBNZ).
The under review with negative implications status was maintained on Jan 22, as LIL’s parent group, Retirement Income Group Limited had been unable to raise sufficient new capital to meet the additional regulatory capital requirements of the licence conditions at LIL.
The company was considering alternative regulatory capital options, in consultation with the RBNZ and the Financial Markets Authority.
The maintaining of the under review with negative implications status reflects continued uncertainty over the company’s prospective balance sheet strength, including the materiality of the supplementary payment to be made to policyholders and LIL’s ability to comply with its licence conditions during the run-off of its liabilities.
The ratings will remain under review until AM Best can fully assess the impact of these factors on LIL’s balance sheet strength fundamentals.
More details at www.ambest.com
-- BERNAMA
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