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AM Best Affirms Credit Ratings of Malaysian Reinsurance Berhad

BY Business Wire | CORPORATE | 09:20 AM EST

SINGAPORE--(BUSINESS WIRE)-- AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of ?a-? (Excellent) of Malaysian Reinsurance Berhad (Malaysian Re) (Malaysia). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Malaysian Re?s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

Malaysian Re?s balance sheet strength is underpinned by its risk-adjusted capitalisation, as measured by Best?s Capital Adequacy Ratio (BCAR), which is expected to remain at the strongest level over the medium term. AM Best views the company?s investment portfolio as generally conservative, whereby the majority of investments are allocated to term deposits, government bonds and good quality corporate bonds. Malaysian Re is subject to catastrophe risk exposures from both its domestic and overseas portfolios, although this risk is mitigated partially by the use of retrocession coverage through well-rated counterparties.

AM Best assesses Malaysian Re?s operating performance as adequate, supported by good earnings stability over time. The company?s net profits rose materially in fiscal year 2024 (ended 31 March 2024), relative to fiscal year 2023, driven by better claims experience and investment returns. The improvement in underwriting performance was attributed to the company?s ongoing business remodelling programme and portfolio remediation measures. In addition, the company?s investment income increased supported by higher domestic interest rates and remained a positive contributor to overall earnings.

Malaysian Re is the largest non-life reinsurer in Malaysia, with a dominant domestic reinsurance market share. AM Best views Malaysian Re?s underwriting portfolio to be increasingly diversified by geography, whereby more than half of its gross premiums were sourced from outside Malaysia in fiscal year 2024. Future business growth is expected to be supported by strategic expansion into non-traditional segments, as part of the company?s ongoing business remodelling programme.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

This press release relates to Credit Ratings that have been published on AM Best?s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best?s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best?s Credit Ratings. For information on the proper use of Best?s Credit Ratings, Best?s Performance Assessments, Best?s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best?s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright ? 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Source: AM Best

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

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