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Fitch affirms ratings of 3 BBVA Bancomer insurers

Fitch Ratings on Dec. 21 affirmed the national scale ratings of Seguros BBVA Bancomer SA de CV Grupo Financiero BBVA BANCOMER, BBVA Bancomer Seguros Salud SA de CV and Pensiones BBVA Bancomer SA de C.V. at AAA(mex), all with a stable outlook.

The ratings consider the support provided by their parent company, Grupo Financiero BBVA Bancomer SA de CV, which is legally bound to cover any potential losses at its subsidiaries.

All three subsidiaries are considered strategically important for the parent and benefit from synergies with other companies in the group, Fitch noted.

Seguros BBVA benefits in particular from synergies with BBVA Bancomer SA, mainly due to the bank's large portfolio of clients. The insurer's profitability is adequate and compares favorably with the average for the sector, which is mainly due to strong growth in premiums, a stable claims rate and operating efficiency.

The insurer had a 6.02% market share in Mexico in terms of written premiums as of December 2015.

Pensiones BBVA is one of the largest companies in Mexico's pension insurance sector with a 37.9% share of written premiums as of December 2015. This is the result of the firm's brand strength, geographic coverage and experience in the sector, Fitch noted.

The good positioning of the insurer in the local market plays an important role in the stability of its internal capital generation capacity and its future financial strength.

BBVA Bancomer Seguros Salud is a relatively small player in the Mexican insurance sector with a market share of 0.04%, but it had a 5.26% share of the local health insurance market as of December 2015, making it the fourth-largest health insurer in the country.

In the last five years, the firm has benefited from leverage levels that are below average for the industry. It has also shown high profitability, mainly due to growth in premiums, a low claims rate and good efficiency, which in turn is partly thanks to synergies with the bank and other companies in the group, Fitch noted.