KUALA LUMPUR, April 8 (Bernama) -- Global credit rating agency, AM Best has affirmed the Hong Kong’s CMB Wing Lung Insurance Company Limited (CMBWLI) financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” (Excellent).
In a statement, AM Best said these credit ratings (ratings) which have a stable outlook reflected CMBWLI’s balance sheet strength, which was assessed as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.
CMBWLI’s very strong balance sheet strength assessment is underpinned by its robust risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR).
The company’s capital base continued to grow organically in 2022, supported by its positive operating results and profit retention, partially offset by a one-off dividend in specie to CMB Wing Lung Bank in 2022. During 2022 and 2023, cash and cash equivalents remained as CMBWLI’s largest asset type.
Additionally, the insurer continues to enhance the credit quality of its bond investments, which remains as its largest investment asset type other than cash, as well as the de-risking of its equity portfolio during 2023.
The company’s overall operating performance has been consistently strong and better than average, as evidenced by annualised returns on equity of eight per cent and nine per cent respectively, in 2022 and 2023.
Net earnings continued to be supported by decent growth in premium volume and profitable underwriting results. CMBWLI’s investment performance continues to be supported by a stream of interest and dividend incomes during 2022 and 2023.
A medium-size, non-life insurer in Hong Kong, and one of the major market players in its domestic market’s employees’ compensation (EC) segment, CMBWLI ’s product mix remained diversified in 2023, with EC, motor and property damage making up the bulk of its business.
CMBWLI has continued to strengthen its risk management over the last few years, including investment risk controls, risk identification and monitoring tools, as well as risk governance.
-- BERNAMA
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