RPT-Fitch Revises Milleniumbcp's Outlook to Positive; Affirms 'BBB-'

Wed Apr 16, 2014 5:04am EDT

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April 16 (Reuters) - (The following statement was released by the rating agency)

Fitch Ratings has revised Milleniumbcp-Ageas operating entities' (MBCPA) Outlook to Positive from Negative and affirmed their Insurer Financial Strength (IFS) ratings at 'BBB-'. MBCPA's parent company is Ageas Insurance International NV (Ageas; Long-term IDR: A-/Stable). A full list of ratings is provided at the end of this comment.

KEY RATING DRIVERS

The Outlook change on MBCPA's ratings follows a similar rating action on Portugal (see "Fitch Revises Outlook on Portugal to Positive; Affirms at 'BB+'"). MBCPA's ratings are affected by Portugal's sovereign ratings because its operations are concentrated on the Portuguese market. The health of the Portuguese economy also has an important impact on life insurance, which is the group's main activity.

MBCPA's ratings benefit from a single-notch uplift due to Ageas ownership. Fitch factors in operational and financial support from Ageas, which continues to view MBCPA as a strategic investment and a long-term partnership. In addition, Ageas has indicated that, together with Millennium bcp, owner of the remaining 49% of MBCPA, it would ensure the protection of existing policyholders should this be necessary. At end-2013, MBCPA reported a regulatory solvency ratio of 317% (end-2012: 273%).

RATING SENSITIVITIES

MBCPA's ratings are likely to be upgraded if Portugal is upgraded and if MBCPA continues to maintain strong capitalisation and contribute positively to Ageas' profitability.

The rating actions are as follows:

Ocidental-Companhia Portuguesa de Seguros de Vida S.A.

IFS rating affirmed at 'BBB-'; Outlook revised to Positive from Negative

Ocidental-Companhia Portuguesa de Seguros S.A.

IFS rating affirmed at 'BBB-'; Outlook revised to Positive from Negative

Medis - Companhia Portuguesa de Seguros de Saude S.A.

IFS rating affirmed at 'BBB-'; Outlook revised to Positive from Negative

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