Fitch Ratings on Oct. 4 downgraded Mexico-based Old Mutual Life SA De CV's insurer financial strength rating to BBB+(mex) from A-(mex), due to the perceived change in the insurance company's strategic importance to its last owner, Old Mutual PLC.
Due to a change in strategy, Old Mutual retired its business on several continents, with the exception of Africa. Earlier this year, the company agreed to sell its Latin American businesses to Singapore-based financial holding company CMIG International.
Despite having a small share in the Mexican market, Old Mutual Life maintains a rising trend in its premiums, Fitch said. The company's leverage level is favorable compared to the sector and its technical results have been historically positive.
However, the pressure caused by operating expenses has resulted in negative net results for the insurer, Fitch said.