Fitch has assigned a national IFS rating of “AA-(bra)” to BTG Pactual Seguradora and an international IFS rating of “BB+” and national IFS of “AA-(bra)” to BTG Pactual Resseguradora. The outlook for all ratings is stable.
The IFS ratings of BTG Seguradora and BTG Resseguradora are driven by potential support from their ultimate parent, Banco BTG Pactual, a Brazilian multinational investment banking firm.
Both BTG Seguradora and BTG Resseguradora are wholly ownder subsidiaries of BTG Pactual Holding de Seguros, which is fully owned by Banco BTG Pactual.
BTG Seguradora started underwriting in February 2013. Its main focus is on surety, accompanied by engineering risks. It plans to underwrite other risks related to infrastructure over the medium term, but the core focus will remain surety.
BTG Resseguradora is BTG Seguradora’s captive reinsurer. It has one statutory employee and only reinsures premiums ceded by BTG Seguradora.
As a reinsurer, BTG Resseguradora is not subject to regulatory maximum retention limits per risk so offers a significant growth potential for the group.
In a recent statement Fitch said: “BTG Resseguradora’s growth will be directly linked to BTG Seguradora over the next two years … In four-five years, [BTG Resseguradora] aims to become a full reinsurance company reinsuring premiums from all segments in Brazil.”
“While Fitch considers its existing know-how, underwriting practices and investment policies as sufficient for the local operations in surety and engineering risks, the agency believes that they would need to evolve and be enhanced in order for the reinsurer to implement its business plan.”
Changes in parent company ratings or willingness to support its subsidiaries could affect the ratings of BTG Seguradora and Resseguradora.
