Standard & Poor’s Ratings Services said today that it revised its outlook to stable from negative on Hungary-based Generali-Providencia Biztosito Zrt (Generali Providencia).
At the same time, the ‘BBB-‘ long-term counterparty credit and insurer financial strength ratings were affirmed then withdrawn at the company’s request.
Prior to the withdrawal, the ratings were significantly influenced by those on the Republic of Hungary (BBB-/Stable/A-3) because Generali Providencia’s investment portfolio is largely correlated to Hungarian sovereign risk.
Other rating factors were the company’s strong competitive position and operating performance. In addition, the company is strategically important to its ultimate parent, Italy-based insurer Assicurazioni Generali SpA (AA-/Stable/–), the parent of the Generali group, which is Europe’s third-largest insurer.
As a result of the rating withdrawal, Generali Providencia is no longer subject to surveillance by Standard & Poor’s. The outlook revision to stable from negative at the time of the withdrawal follows the outlook revision on the Republic of Hungary (for more information, see “Republic of Hungary Outlook Revised To Stable On Sustained Consolidation Effort; ‘BBB-/A-3’ Ratings Affirmed,” published today on RatingsDirect).
This reflects that Generali Providencia’s credit quality will remain highly exposed to that of Hungary.
