AM Best Affirms Credit Ratings of North End Re Ltd.

Rhea-AI Summary

AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of 'a-' (Excellent) for North End Re Ltd., with a stable outlook. This reflects the company’s strong balance sheet strength and adequate operating performance. Notably, North End Re Ltd. aims to maintain robust risk-adjusted capital levels as it expands operations. Recently, Brookfield Reinsurance acquired American National Group, Inc. for approximately $5.1 billion, enhancing North End Re Ltd.'s market position. However, the company faces challenges from high competition and temporary investment losses due to rising interest rates.

Positive

• Affirmation of A- (Excellent) Financial Strength Rating and 'a-' Long-Term Issuer Credit Rating.
• Strong balance sheet and adequate operating performance.
• Plan to maintain strong risk-adjusted capital levels.
• Successful reinsurance transaction involving $1.6 billion of fixed deferred annuities.

Negative

• High competition in the reinsurance market.
• Temporary realized investment losses due to rising interest rates.

OLDWICK, N.J.--(BUSINESS WIRE)--

AM Best has affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of North End Re Ltd. (Bermuda). The outlook of these Credit Ratings (ratings) is stable.

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

The ratings also reflect North End Re Ltd.’s plan of maintaining strong risk-adjusted capital levels, as measured by Best’s Capital Adequacy Ratio (BCAR), as the company ramps up operations in the coming years. The company expects to use external and internal revolving lines of credit to maintain these levels and to provide substantial liquidity. North End Re Ltd. closed one transaction in third-quarter 2021, reinsuring $1.6 billion of fixed deferred annuities.

North End Re Ltd.’s parent, Brookfield Reinsurance Ltd. (Brookfield Reinsurance), is a publicly traded reinsurance company focused on providing capital-based solutions to insurance companies. Brookfield Reinsurance seeks capital-intensive business to leverage its asset management and sourcing capabilities. Brookfield Reinsurance recently acquired American National Group, Inc. [NASDAQ: ANAT] in an all-cash transaction valued at approximately $5.1 billion. North End Re Ltd. geographically complements its sister company, North End Re (Cayman) SPC, which is also in its first full year of establishing reinsurance operations. The company has another sister company, Brookfield Annuity Company, that provides pension risk transfer solutions in Canada.

Slightly offsetting these favorable attributes of North End Re Ltd. and its greater organization are the high level of competition and the temporary realized investment losses caused by rising interest rates. AM Best notes that the company was quick in establishing itself in the market, showing early success against competitors; rising interest rates will be a favorable factor for the company over the longer term.

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 specializing 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 © 2023 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230125005582/en/

Kevin Varvaro

Senior Financial Analyst

+1 908 439 2200, ext.5487

kevin.varvaro@ambest.com



Anthony McSwieney

Senior Financial Analyst

+1 908 439 2200, ext.5715

anthony.mcswieney@ambest.com



Christopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com



Al Slavin

Senior Public Relations Specialist

+1 908 439 2200, ext. 5098

al.slavin@ambest.com

Source: AM Best

FAQ

What ratings has AM Best assigned to North End Re Ltd.?

AM Best has affirmed a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of 'a-' (Excellent) for North End Re Ltd.

What recent acquisition did Brookfield Reinsurance make?

Brookfield Reinsurance acquired American National Group, Inc. for approximately $5.1 billion.

How does North End Re Ltd. plan to maintain its capital levels?

North End Re Ltd. plans to use external and internal revolving lines of credit to maintain strong risk-adjusted capital levels.

What challenges is North End Re Ltd. currently facing?

North End Re Ltd. is facing high competition and temporary investment losses due to rising interest rates.