Societa Cattolica di Assicurazione : S&P alza il rating di Cattolica a BBB outlook stabile

Società Cattolica di Assicurazione - Società Cooperativa

Sede in Verona, Lungadige Cangrande n.16

C.F. 00320160237 - Iscritta al Registro delle Imprese di Verona al n. 00320160237 Società iscritta all'Albo delle Società Cooperative al n. A100378

www.cattolica.it

COMUNICATO STAMPA S&P alza il rating di Cattolica a BBB outlook stabile

Verona, 31 ottobre 2017. Standard & Poor's ha alzato oggi il rating di Cattolica da BBB- a BBB. L'outlook è confermato stabile.

Il rating di Cattolica segue, secondo quanto previsto dai criteri dell'agenzia, il rialzo del rating della Repubblica Italiana a BBB stabile, reso pubblico il 27 ottobre scorso.

Lo stand-alone credit profile (SACP) di Cattolica è confermato a bbb+, un notch più alto del rating sovrano, grazie ad un profilo di rischio finanziario "più che adeguato" ed un profilo di rischio dei business "forte" che può avvantaggiarsi del miglioramento dell'industria assicurativa italiana e dell'aggiornata valutazione del rischio paese.

SOCIETA' CATTOLICA DI ASSICURAZIONE

CONTATTI

Investor Relations Officer

Enrico Mattioli Tel. [phone]

[e-mail]

s&P Global

Ratings

RatingsDir ct®

Research Update:

Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade; Outlook Stable

Primary Credit Analyst:

Marco Sindaco, Madrid (34) 91-788-7218; marco.sindaco@spglobal .com

Secondary Contact:

Taos D Fudji, Milan (39) 02-72111-276; [e-mail]

Table Of Contents

Overview Rating Action Rationale Outlook

Ratings Score Snapshot Related Criteria

Ratings List

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Research Update:

Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade; Outlook Stable Overview

• On Oct. 27, 2017, S&P Global Ratings raised its unsolicited long-term sovereign credit ratings on the Republic of Italy to 'BBB' from 'BBB-'.

• The ratings on Italian insurer Societa Cattolica di Assicurazione (Cattolica) are limited by the sovereign credit rating on Italy due to Cattolica• s material exposure to Italian investments. Cattolica's credit profile before taking into account the sovereign cap is 1 bbb+ 1 •

  • As a result of the sovereign upgrade, we are raising our ratings on Cattolica to 'BBB' from 'BBB-'.

• The stable outlook reflects that on the Republic of Italy.

Rating Action

On Oct. 31, 2017, S&P Global Ratings raised to 'BBB' from 'BBB-' its long-term counterparty credit rating and insurer financial strength rating on Italian insurer Societa Cattolica di Assicurazione (Cattolica). The outlook is stable.

We also raised our rating on Cattolica's subordinated debt issue to 'BB+' from 'BB'.

Rationale

The rating actions follow the upgrade of Italy. We raised our unsolicited sovereign credit ratings on Italy to 'BBB/A-2' from 'BBB-/A-3' on Oct. 27, 2017 (see "Italy Upgraded To 'BBB/A-2' On Firming Economic Recovery; Outlook Stable," published on RatingsDirect).

We believe Cattolica's exposure to sovereign risk has improved following the raising of our ratings on Italy. We expect Cattolica to benefit from the improved economic conditions in Italy, as well as the improved credit risk associated with Italian sovereign bonds. As of June 30, 2017, Cattolica had invested about €11 billion in Italian government securities, or approximately 5.4x the consolidated shareholders' equity. As result of its material investment exposure to Italian assets, we cap our rating on Cattolica at the level of the long-term sovereign ratings on Italy.

Cattolica's stand-alone credit profile (SACP)--our opinion of its creditworthiness before taking into account sovereign risk- -is unchanged at

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Research Update: Italy-Based Societa Cattolica di Assicurazione Upgraded To 'BBB' Following Sovereign Upgrade;

Outlook Stable

1 bbb+ 1 , one notch higher than the ratings.

We believe Cattolica's business risk profile is set to benefit from the improved Italian insurance industry and country risk assessment. In addition, since Oct. 17, 2017, Cattolica has been holding exclusive discussions with Banco BPM, Italy's third-largest bank, for a long-term distribution agreement and the acquisition of two bancassurance joint ventures. We believe the insurer's business profile would benefit from such an agreement with Banco BPM, as it would strengthen its position in the Italian life and property/casualty insurance market, while providing scope for significant economies of scale.

On the other hand, we believe Cattolica's capital adequacy and financial risk profile may potentially weaken due to the cost of the acquisition and the impact of the consolidation of the joint ventures with Banco BPM. For this reason, we currently factor a negative adjustment under our holistic analysis to the 'bbb+' SACP.

Outlook

The stable outlook mirrors that on the sovereign credit rating on the Republic of Italy.

Upside scenario

We could raise the ratings on Cattolica if we were to raise our ratings on Italy.

Downside scenario

We could lower the ratings on Cattolica if we were to lower our ratings on Italy.

Ratings Score Snapshot

Financial Strength Rating

To BBB/Stable

From

BBB-/Stable

Indicative SACP bbb+ bbb+

Anchor

Business Risk Profile

IICRA

Competitive Position Financial Risk Profile

Capital & Earnings Risk Position Financial Flexibility

a-

Strong Intermediate Risk Strong

Upper Adequate Upper Adequate Intermediate Risk Adequate

bbb+ Satisfactory Moderate Risk Strong

Upper Adequate Upper Adequate Intermediate Risk Adequate

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