IBI-Rating has upgraded the credit rating of PJSC «NJSIC «ORANTA» at uaA grade

Rating agency IBI-Rating informs on upgrading of the credit rating of PJSC «NJSIC «ORANTA» at uaA grade, the rating outlook is «evolving».

PJSC «NJSIC «ORANTA» is the legal successor of Ukrderzhstrakh, which founded on November 25, 1921. In 1993, the Ukrderzhstrakh was transformed into the Public Joint-Stock Company «National Joint-Stock Insurance Company «Oranta», the founder of which, on the part of the state, was the State Property Fund of Ukraine. In 2007, the State Property Fund of Ukraine sold to the investor the last block of state-owned shares. The shareholders of PJSC «NJSIC «ORANTA», which have more than 10% of the shares, are JSC «BTA Bank» (Kazakhstan – 35.17% of shares), as well as company registered in the Republic of Cyprus - BACKWOOD HOLDINGS LIMITED (13.74%).

The insurer activities basis on the 33 licenses - 15 mandatory and 18 voluntary types. Following the results by 2019, PJSC «NJSIC «ORANTA» occupied such positions among more than 200 participants of the insurance market (non-life): by own capital - 15th place; by amount of attracted premiums - 11th place, as well as 10th position by assets, insurance reserves, and made insurance claim payment. Besides, PJSC «NJSIC «ORANTA» stably ranks a leading position in the amount of insurance premiums for compulsory insurance of civil liability of owners of land vehicles. The financial result of the insurance company had a positive value - net profit in 2019 amounted to UAH 240 thousand. In turn, the net profit in January-March 2020 amounted to almost UAH 35 million, which was facilitated, in particular, by a higher growth rate of earned payments than the growth of insurance payments, saving costs associated with payment services insurance agents and others.

The upgrading of the long-term credit rating grade is due to the preservation of high solvency ratios, strong market positions, the presence of well-developed sales channels, which contributes to the positive dynamics of insurance payments. Additionally, it should be noted as sufficient levels of diversification and quality of assets, which represented the insurance reserves as well as improving performance indicators and profitable activities of the company. In turn, IBI-Rating notes a significant amount of losses of previous years, which reducing its capitalization level; significant operating expenses and high concentration of insurance portfolio by type of insurance, instability of the operating environment, the variability of the regulatory field, as well as the sensitivity of the company's revenue base to changing the situation in the real sector. The «evolving» rating outlook is due to uncertainty about the impact on the financial condition of the insurance company of the expected significant slowdown in business activity due to the deteriorating epidemiological situation in the country in the Q1 2020 and imposed economic and administrative restrictions on economic entities and individuals.

In order to conduct the analytical research the materials provided by PJSC «NJSIC «ORANTA» have been used, including: the annual financial statements for 2017-2019 and 3 months by 2020, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.

Financial department
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