Fitch gives Japan’s insurance companies best possible ratings

Fitch Ratings has set the long-term, issue default ratings’ (IDR) ‘outlook’ of all ten Japanese insurance companies at ‘stable’. The move follows ratings reviews and upgrades of the individual firms’ debt lines  (see below).

For eight of the firms — Daido Life,  Fukoku Mutual Life, Meiji Yasuda Life, Mitsui Sumitomo Insurance, Nippon Life, Sompo Japan Nipponkoa, Sumitomo Life and Taiyo Life — the stable label is the highest they can achieve since it is equivalent to Fitch’s view on Japan’s long-term, local currency, sovereign debt which makes up a large part of their balance sheets.

For Dai-ichi Life and Tokio Marine & Nichido Fire, Fitch is of the view that ‘their business diversification counterbalances their heavy Japanese government debt holdings [and this allows their ratings] to be up to one notch higher than’ those of the others but does not say what that rating is.

It notes too that the parent of Mitui Sumitomo Insurance, MS&AD Insurance Group Holdings, has been expanding overseas  by acquiring foreign insurers and is approaching the threshold where it could be considered internationally diversified.

Fitch’s ratings for the firms are now:

Dai-ichi Life Insurance Insurer Financial Strength (IFS) rating affirmed at ‘A+’; Outlook revised to Stable from Negative, Long-Term IDR affirmed at ‘A’; Outlook Stable; US$1.3 billion cumulative perpetual subordinated notes issued in 2011 affirmed at ‘A-‘; US$1 billion cumulative perpetual subordinated notes issued in 2014 affirmed at ‘A-‘; US$2.5 billion cumulative perpetual subordinated notes issued in 2016 affirmed at ‘A-‘.

Daido Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative.

Fukoku Mutual Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative, Long-Term IDR affirmed at ‘A-‘, Outlook Stable;                                          US$0.5 billion cumulative perpetual subordinated notes issued in 2013 affirmed at ‘BBB+’,                                                                                                                                             US$0.5 billion cumulative perpetual subordinated notes issued in 2015 affirmed at ‘BBB+’.

Meiji Yasuda Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative Long-Term IDR affirmed at ‘A’; Outlook revised to Stable from Negative;       US$2 billion subordinated notes due 2045 affirmed at ‘A-‘.

Mitsui Sumitomo Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative –Long-Term IDR affirmed at ‘A’; Outlook revised to Stable from Negative;       US$1.3 billion subordinated notes due 2072 affirmed at ‘A-‘.

Nippon Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative Long-Term IDR affirmed at ‘A’; Outlook revised to Stable from Negative;              US$2 billion subordinated notes due 2042 affirmed at ‘A-‘,                                              US$2.25 billion subordinated notes due 2044 affirmed at ‘A-‘,                                              US$1.5 billion subordinated notes due 2046 affirmed at ‘A-‘.

Sompo Japan Nipponkoa Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative –Long-Term IDR affirmed at ‘A’; Outlook revised to Stable from Negative;                                                                                                                                          US$1.4 billion subordinated notes due 2073 affirmed at ‘A-‘.

Sumitomo Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative, Long-Term IDR affirmed at ‘A’; Outlook revised to Stable from Negative;         US$1 billion subordinated notes due 2073 affirmed at ‘A-‘

Taiyo Life Insurance IFS rating affirmed at ‘A’; Outlook revised to Stable from Negative

Tokio Marine & Nichido Fire Insurance IFS rating affirmed at ‘A+’; Outlook revised to Stable from Negative

 

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