A.M. Best Affirms Ratings of BMO Reinsurance Limited Business Wire OLDWICK, N.J. -- August 28, 2013 A.M. Best Co. has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a+” of BMO Reinsurance Limited (BMO Re) (Barbados). The outlook for both ratings is stable. BMO Re is an indirect wholly owned subsidiary of Bank of Montreal (BMO) (Toronto, Ontario) and is a reinsurer of life, property/casualty and disability risks. The ratings of BMO Re reflect its stable net income trends, favorable risk-adjusted capitalization and strong liquidity in its investment portfolio. BMO Re continues to maintain strong risk-adjusted capitalization levels, as well as low levels of credit risk within its investment portfolio, which is primarily invested in highly-rated sovereigns, supranationals and corporate bonds. Higher premium volumes have been recorded in recent periods, driven by diversification in its business mix to include both life and non-life risks. A.M. Best notes that the company faces potential challenges associated with strengthening distribution channels and new product acceptance as it looks to further expand its business profile. Additionally, volatility in economic conditions in Europe could impact BMO Re’s ability to retrocede assumed risks to its European counterparties. BMO Re is exposed to potential earnings volatility from its assumed property/casualty risk; however, A.M. Best anticipates a lesser degree of volatility compared to previous years. BMO Re is considered well positioned at its current rating level. Positive rating actions are unlikely in the near or intermediate term. Factors that may cause negative rating actions include a significant decline in the company’s capitalization and/or business outlook, a decline in its operating performance and a change in the regulatory environment, which impacts its business model, and/or any negative rating actions at BMO. The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED. Contact: A.M. Best Co. Anthony McSwieney, 908-439-2200, ext. 5715 Senior Financial Analyst email@example.com or Rosemarie Mirabella, CPA, 908-439-2200, ext.5892 Managing Senior Financial Analyst firstname.lastname@example.org or Rachelle Morrow, 908-439-2200, ext. 5378 Senior Manager, Public Relations email@example.com or Jim Peavy, 908-439-2200, ext. 5644 Assistant Vice President, Public Relations firstname.lastname@example.org
A.M. Best Affirms Ratings of BMO Reinsurance Limited
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