Rating Agency Expert RA Kazakhstan assigned "A" reliability rating to BTA Bank Subsidiary Insurance Company London-Almaty

/KASE, March 1, 12/ - BTA Bank Subsidiary Insurance Company London-Almaty (Almaty), shares of which are officially listed on Kazakhstan Stock Exchange (KASE), provided to KASE Rating Agency Expert RA Kazakhstan press-release of February 23, 2012: quotation Rating Agency Expert RA Kazakhstan assigned "A" reliability rating "high reliability rating" to BTA Bank Subsidiary Insurance Company London-Almaty. The positive influence on the company rating resulted from high values of the current liquidity coefficient and adjusted insurance net liquidity (according to the data as of October 1, 2011 350% and 158% accordingly). The insurer is characterized by well diversified structure of securities insurance portfolio (Herfindahl-Hirschman index as of October 1, 2011 - 0.077), high level of investment capital profitability (for 9 months of 2011 ROI=7.8%), high level of equity capital sufficiency (407.8% in 2010), availability of major payments experience (the largest payment on property insurance in the size of KZT496.5 mln), high reliability and efficiency of reinsurance coverage. Among positive factors are also moderate indicators of the main insurance types unprofitability, reinsurance coverage on all major risks, stable insurance portfolio, high level of corporate governance, moderately high geographic diversification of activities (according to results of 2010, Herfindahl-Hirschman index - 0.32). Among factors restraining the rating influence are high values of net unprofitability combined coefficient and business costs (for 9 months of 2011 106.0% and 65.2% accordingly (has been calculated based on Expert RA Kazakhstan methodology), not highly diversified of reinsurance coverage (for 9 months of 2011 Herfindahl-Hirschman index - 0.39). The principal shareholder default had restricting influence on the rating. "From our standpoint, BTA Bank default decreases the company reliability, but not significantly considering its financial self-sufficiency and business independence from the company affiliates", - said Deputy Director General of Expert RA Kazakhstan Arman Zhakhin. Among restraining factors are also high level of accounts receivable and failure to pay them, unstable ratio of solvency actual margin, low percentage of agreements recommencement on property insurance and third party liability insurance, high dependence on outgoing reinsurance (for 9 months of 2011 74.6% charges of insurance have been transferred to reinsurance), relatively low indicators of assets profitability and equity capital (for 9 months of 2011 ROA=3.6%, ROE=7.0%). Insurance Company London-Almaty is a universal insurer. According to results of 9 months of 2011, the data of FSC, the company is on the 8th place on the volume of aggregate insurance premiums among all Kazakhstan insurance companies, the 7th place on property insurance, the 2nd place on third party liability insurance, the 1nd place on cargo insurance, 1st place on vehicles insurance. As of October 1, 2011, the company assets made up KZT10.7 bn, equity capital - KZT6.6 bn, authorized capital - KZT1.5 bn, insurance fees for 9 months of 2011 - KZT5.5 bn. Expert RA Kazakhstan Press Service Assel Omarova tel. +7 (727) 296-47-44 вн. 4820 mob. +7 777 470 77 51 e-mail: omarova@raexpertkz.kz ends [2012-03-01]