A.M. Best Affirms Rating of Hang Seng Life Limited.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A+ (Superior) of Hang Seng Hang Seng An index of the leading stocks on the Hong Kong stock market. Notes: The Hang Seng Index (HSI) comprises different stocks that are representative of the whole Hong Kong market. See also: DAX, Index, Nikkei, S&P 500 Life Limited (HSL (Hue Saturation Luminosity) A color space similar to HSB. See HSB. ) (Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. ). The rating outlook is stable. The rating reflects HSL's strong distribution capabilities, sound capitalization level, sustained increase in embedded value Embedded Value A common valuation measure used outside North America particularly in the insurance industry. It is calculated by adding the adjusted net asset value and the present value of future profits of a firm. , robust new business growth and satisfactory operating performance. Hang Seng Bank Hang Seng Bank Limited (Traditional Chinese: 恒生銀行有限公司) HKSE: 0011 is the second largest bank in Hong Kong. It is a listed company but it is majority owned (62. has a 50% ownership in HSL, which allows HSL to tap into the mass market through the vast branch network of Hang Seng Bank. Backed by the management team of HSBC HSBC Hongkong and Shanghai Banking Corporation HSBC Humane Society of Broward County (Florida) HSBC Humane Society of Bay County (Bay County, Michigan) Life (International) Limited, HSL has grown rapidly over the past three years, particularly in the individual life non-linked business. HSL acquired approximately a 4.1% share of the long-term insurance market in 2004, as measured by office premiums of in-force life business. Both underwriting activities and investments contributed to HSL's profitability in 2004. The company's average annual return on equity over the last five years exceeded 18%. The embedded value of HSL's life portfolio grew over 50% in 2003, which is in line with its significant premium growth. The Best's Capital Adequacy Ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. , which measures capitalization on a risk-adjusted basis, reflects the adequate solvency margin of HSL on a stand-alone basis, despite its significant premium growth. The company's capital and surplus increased by more than 50% in 2004 as a result of strong earnings. Offsetting factors include increased pressure on capital due to higher business volume and intense competition in the life insurance market. Recent robust growth in the ordinary life business has exerted significant pressure on HSL's risk-adjusted capitalization. In addition, HSL's dynamic growth momentum is expected to be counteracted by intense market competition over the longer term, although the company has a competitive advantage in generating a new customer base through Hang Seng Bank. For Best's Ratings, an overview of the rating process and rating methodologies, please visit http://www.ambest.com/ratings. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at http://www.ambest.com. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion