Fitch Ratings has affirmed the 'BBB+' Insurer Financial Strength (IFS) rating and the 'AAA(col)' national IFS rating of Black Gold Re (BGRe).
In BGRe’s rating, Fitch states it has considered the full support of its parent, due to the strong linkage and strategic importance of the captive company to its parent, Ecopetrol.
The rating also reflects good operating performance, strong capitalisation and liquidity levels and adequate reinsurance protection.
BGRe's rating remains equalised to its parent's rating, considering that Fitch has categorised this subsidiary as a 'core captive'. Ecopetrol has a local-currency Issuer Default Rating (LC IDR) of 'BBB+'.
Ecopetrol's ratings are also linked to the credit profile of the Republic of Colombia (local and foreign currency IDRs of 'BBB' and 'BBB+', respectively), which owns 88.5 percent of the company's total capital.
Ecopetrol conducts business as Grupo Empresarial Ecopetrol (GEE).
Additionally BGRe remains as a core subsidiary of Ecopetrol, due to its strategic importance to the risk management and the insurance coverage of GEE.
BGRe's support from its parent is evidenced by the Ecopetrol's formal support for BGRe's investment portfolio administration, the provision of resources for optimal operation of the reinsurance company, and the explicit commitment through open notes and the transference of strong corporate governance practices as well as the alignment of objectives and strategy.
These ratings also consider BGRe's capital and liquidity position, which Fitch has stated "provides a strong cushion" against the risks faced by the reinsurer.
