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Moody's upgrades, subsequently withdraws El Pacífico's rating following merger

Moody's on Aug. 2 upgraded the global local-currency insurance financial strength rating of El Pacífico Peruano Suiza Compañía de Seguros y Reaseguros SA to Baa2 from Baa3 and changed its outlook to stable from positive.

However, Moody's said it will withdraw the insurer's rating immediately following the ratings action.

The actions came after the completion of the merger of El Pacífico Peruano into its life insurance subsidiary, El Pacífico Vida Co. De Seguros Y Reaseguros SA. The upgrade of El Pacífico's rating reflects, among other factors, the enhancement of the insurer's credit profile after the merger.

The merger will lead to greater product and risk diversification for the newly combined entity across property and casualty and life and annuity businesses, strengthened capitalization and improved asset quality, Moody's said.

The expected synergies from the merger would also introduce cost reductions and increased efficiencies, positively impacting the merged company's prospective profitability, Moody's added.

The withdrawal was due to to the reorganization of the company following the merger.