AM Best Affirms Excellent Credit Ratings For Malaysian Reinsurance
KUALA LUMPUR, Jan 23 (Bernama) -- AM Best has affirmed the financial strength rating of A- (Excellent) and the long-term issuer credit rating of “a-” (Excellent) of Malaysian Reinsurance Berhad (Malaysian Re), with a stable outlook of these credit ratings (ratings).
The ratings reflect Malaysian Re’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
As measured by Best’s Capital Adequacy Ratio, Malaysian Re’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which is expected to remain at the strongest level over the medium term.
Malaysian Re has good financial flexibility, as demonstrated by its historical subordinated debt issuances, while its investment portfolio is viewed as generally conservative, with the majority of investments allocated to term deposits, government bonds and good-quality corporate bonds.
However, Malaysian Re is subject to catastrophe risk exposures from both its domestic and overseas portfolios, although this risk is mitigated partially by the use of retrocession coverage through well-rated counterparties, according to the global credit rating agency in a statement.
AM Best assesses Malaysian Re’s operating performance as adequate, supported by positive operating results over the past five years. It reported a return-on-equity ratio of 13.5 per cent in fiscal year 2025 (ended March 31, 2025), and earnings remained robust in the first half of fiscal year 2026.
The company’s underwriting performance has improved in recent years, mainly attributed to its ongoing business remodelling programme, portfolio remediation measures and benign catastrophe losses.
As the largest non-life reinsurer in Malaysia with a dominant share of its domestic reinsurance market, Malaysian Re benefits from a mandatory domestic reinsurance cession arrangement, which provides it with access to a steady stream of domestic reinsurance business.
-- BERNAMA