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Excellent Athora Life Re credit ratings affirmed

Athora Life Re Ltd., John W Swan Building, 26 Victoria Street, Hamilton (Photograph by David Fox

AM Best, the credit-rating agency has expressed confidence in a Bermuda reinsurer, spun off from Athene Holding Ltd. (now Apollo Global Management, Inc.) in 2018.

Athora Life Re Ltd. is now a European life insurance consolidator, as well as savings and pensions provider.

At year-end 2022, the group had EUR 74 billion of assets under administration and apart from Bermuda, had operations in Belgium, Germany, Ireland, Italy and the Netherlands.

AM Best made these observations as it affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of the reinsurer, and of Athora Ireland plc.

Both entities are wholly owned subsidiaries of Athora Holding Ltd., the non-operating Bermuda holding company of the group. The outlook of these Credit Ratings is stable.

The ratings reflect very strong balance sheet strength, adequate operating performance, neutral business profile and appropriate enterprise risk management.

Athora’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, was at the strongest level at year-end 2022.

Best said net required capital is expected to increase over the medium term as the group continues to allocate a higher proportion of its investment portfolio to higher-yielding asset classes.

Nevertheless, BCAR scores are expected to stay comfortably at the strongest level over the forecast period, supported by capital draw downs to fund any prospective acquisitions.

Athora has solid financial flexibility and sophisticated asset-liability management.

AM Best said: “The group has a track record of adequate operating performance, evidenced by a five-year (2018-2022) weighted average return on equity of 9 per cent.

“There is uncertainty in Athora’s forecast performance as the group’s profitability will be dictated by the successful implementation of its investment and hedging strategies and the execution of large, low volume transactions.

“Should this strategy be implemented successfully, AM Best expects the group to be able to achieve strong overall returns over the medium to long term.”

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Published May 14, 2023 at 6:30 pm (Updated May 14, 2023 at 7:37 pm)

Excellent Athora Life Re credit ratings affirmed

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