Fitch rates Sul America AA-(bra)

Fitch Ratings said it assigned AA-(bra) long- and F1+(bra) short-term national ratings to Sul America SA and affirmed its international long-term foreign- and local- currency issuer default ratings at BB, short-term foreign- and local-currency issuer default ratings at B and its $200 million senior notes at long-term foreign-currency BB-.

The outlook is stable.

The agency said the ratings reflect the strengthening of Sul America's franchise, mainly due to substantial improvements in the underwriting, pricing and control policies adopted since 2004. Sul America's $200 million eurobond and initial public offering in 2007 allowed the group to enhance its debt maturity profile, reduce overall debt and financial costs, enabling a more consistent operational performance across economic cycles, Fitch added.

Nevertheless, the agency estimates that Sul America's earnings will be pressured by smaller financial gains and a more adverse operating environment due to the global financial crisis. Sul America's ratings also reflect the high concentration of premium generation in the health and auto segments and in some distribution channels as well as a higher operational leveraging than main competitors, Fitch said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.