Standard & Poor?s Ratings Services announced from its Tokyo office that it has assigned its ?A-? insurer financial strength rating to New Century Insurance Co. Ltd. and placed the rating on CreditWatch with positive implications.

?Because New Century is a pure captive insurance arm and core subsidiary of Mitsubishi Corp. (A-/Watch Pos/A-2), it shares the same rating as its parent,? S&P said.

?Mitsubishi Corp. holds a 98.8 percent stake in the insurer, which is licensed in Bermuda and plays an important role in Mitsubishi Corp.?s risk management.?

S&P noted further: ?New Century?s operations are restricted to reinsuring risks of its parent and group companies. The insurer plans to enhance its capitalisation through profit accumulation, while gradually expanding its underwriting throughout the Mitsubishi Corp. group.

?New Century has realised high profitability backed by favourable performance from its marine cargo insurance segment, which accounts for the majority of its reinsurance underwriting.

?Most of its assets are bank deposits, so the insurer has good asset quality and liquidity, although investment return is low. New Century is exposed to exchange risks because its assets are dollar denominated.

?However, the weighting of dollar-denominated settlements should rise in line with the growth of the parent company?s overseas energy transactions.?