A.M. Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of "bbb" of Emirates Retakaful Ltd. (ERL) (United Arab Emirates). The Credit Ratings (ratings) have been removed from under review with negative implications. The outlook assigned to these ratings is negative. Concurrently, A.M. Best has withdrawn the ratings as the company has requested to no longer participate in A.M. Best's interactive rating process.
The ratings reflect ERL's balance sheet strength, which A.M. Best categorises as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management. The negative outlooks reflect the company's diminishing business profile, which is expected to shrink materially in 2018, and pressure on risk-adjusted capitalisation, in case capital is withdrawn. The company has gradually de-risked its investment portfolio over the past six months, and A.M. Best expects risk-adjusted capitalisation to remain strongest over the medium term, subject to the shareholders retaining capital in the company. The company's operating performance remains modest and has been impacted by a contribution write-off in 2016.
