Società Cattolica di Assicurazione - Società Cooperativa
Sede in Verona, Lungadige Cangrande n.16
C.F. 00320160237 - Iscritta al Registro delle Imprese di Verona al n. 00320160237 Società iscritta all'Albo delle Società Cooperative al n. A100378
www.cattolica.it
PRESS RELEASE S&P upgrades Cattolica's rating at BBB outlook stableVerona, October 31st, 2017. Today Standard & Poor's has raised Cattolica's rating from BBB- to BBB. Outlook is affirmed stable.
Cattolica's rating follows, as set out under S&P's criteria, the upgrade of Italy's rating to BBB stable, made public on October, 27.
Cattolica's stand-alone credit profile (SACP) is affirmed at bbb+, one notch higher than Italy's rating, thanks to an "upper adeguate" financial risk profile and a "strong" business risk profile that benefits from the improvements of the Italian insurance industry and from the updated assessment of country risk.
SOCIETÁ CATTOLICA DI ASSICURAZIONE
CONTACT INFO
Investor Relations Officer
Enrico Mattioli Tel. 045 8391202
investor.relations@cattolicaassicurazioni.it
s&P Global
Ratings
RatingsDir ct®Research Update:
Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade; Outlook Stable
Primary Credit Analyst:
Marco Sindaco, Madrid (34) 91-788-7218; marco.sindaco@spglobal .com
Secondary Contact:
Taos D Fudji, Milan (39) 02-72111-276; taos.fudji@spglobal.com
Table Of Contents
Overview Rating Action Rationale Outlook
Ratings Score Snapshot Related Criteria
Ratings List
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Research Update:
Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade; Outlook Stable OverviewOn Oct. 27, 2017, S&P Global Ratings raised its unsolicited long-term sovereign credit ratings on the Republic of Italy to 'BBB' from 'BBB-'.
The ratings on Italian insurer Societa Cattolica di Assicurazione (Cattolica) are limited by the sovereign credit rating on Italy due to Cattolica• s material exposure to Italian investments. Cattolica's credit profile before taking into account the sovereign cap is 1 bbb+ 1 •
• As a result of the sovereign upgrade, we are raising our ratings on Cattolica to 'BBB' from 'BBB-'.
The stable outlook reflects that on the Republic of Italy.
On Oct. 31, 2017, S&P Global Ratings raised to 'BBB' from 'BBB-' its long-term counterparty credit rating and insurer financial strength rating on Italian insurer Societa Cattolica di Assicurazione (Cattolica). The outlook is stable.
We also raised our rating on Cattolica's subordinated debt issue to 'BB+' from 'BB'.
RationaleThe rating actions follow the upgrade of Italy. We raised our unsolicited sovereign credit ratings on Italy to 'BBB/A-2' from 'BBB-/A-3' on Oct. 27, 2017 (see "Italy Upgraded To 'BBB/A-2' On Firming Economic Recovery; Outlook Stable," published on RatingsDirect).
We believe Cattolica's exposure to sovereign risk has improved following the raising of our ratings on Italy. We expect Cattolica to benefit from the improved economic conditions in Italy, as well as the improved credit risk associated with Italian sovereign bonds. As of June 30, 2017, Cattolica had invested about €11 billion in Italian government securities, or approximately 5.4x the consolidated shareholders' equity. As result of its material investment exposure to Italian assets, we cap our rating on Cattolica at the level of the long-term sovereign ratings on Italy.
Cattolica's stand-alone credit profile (SACP)--our opinion of its creditworthiness before taking into account sovereign risk- -is unchanged at
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Research Update: Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade;
Outlook Stable
1 bbb+ 1 , one notch higher than the ratings.
We believe Cattolica's business risk profile is set to benefit from the improved Italian insurance industry and country risk assessment. In addition, since Oct. 17, 2017, Cattolica has been holding exclusive discussions with Banco BPM, Italy's third-largest bank, for a long-term distribution agreement and the acquisition of two bancassurance joint ventures. We believe the insurer's business profile would benefit from such an agreement with Banco BPM, as it would strengthen its position in the Italian life and property/casualty insurance market, while providing scope for significant economies of scale.
On the other hand, we believe Cattolica's capital adequacy and financial risk profile may potentially weaken due to the cost of the acquisition and the impact of the consolidation of the joint ventures with Banco BPM. For this reason, we currently factor a negative adjustment under our holistic analysis to the 'bbb+' SACP.
Outlook
The stable outlook mirrors that on the sovereign credit rating on the Republic of Italy.
Upside scenario
We could raise the ratings on Cattolica if we were to raise our ratings on Italy.
Downside scenario
We could lower the ratings on Cattolica if we were to lower our ratings on Italy.
Ratings Score Snapshot
Financial Strength Rating
To BBB/Stable
From
BBB-/Stable
Indicative SACP bbb+ bbb+
Anchor
Business Risk Profile
IICRA
Competitive Position Financial Risk Profile
Capital & Earnings Risk Position Financial Flexibility
a-
Strong Intermediate Risk Strong
Upper Adequate Upper Adequate Intermediate Risk Adequate
bbb+ Satisfactory Moderate Risk Strong
Upper Adequate Upper Adequate Intermediate Risk Adequate
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Società Cattolica di Assicurazione Soc. Coop. published this content on 31 October 2017 and is solely responsible for the information contained herein.
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