DAI-ICHI LIFE HOLDINGS, INC.
Fitch Ratings has upgraded
The Rating Outlook is Stable.
Key Rating Drivers
The upgrade of Protective's ratings follows the upgrade of
Fitch views Protective's SACP as in line with an 'A' IFS rating, and reflects the company's moderate business profile, strong balance sheet fundamentals based on Protective's solid risk-based capitalization, and above-average exposure to reserve funding arrangements. The ratings also reflect solid debt service capability and relatively low investment risk. Protective's earnings have been negatively impacted by adverse mortality due to the pandemic, but are expected to improve in line with rating expectations over the next one to two years.
As a wholly-owned subsidiary of Dai-ichi, Protective derives significant financial flexibility from its parent. Fitch expects Dai-ichi will continue to provide capital to support organic growth and M&A at Protective, which represents Dai-ichi's largest business outside of
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive rating action/upgrade:
An improvement in Protective's standalone credit profile coupled with an upgrade in Dai-ichi's rating or an increase in strategic importance to Dai-ichi coupled with an upgrade in Dai-ichi's rating.
Factors that could, individually or collectively, lead to negative rating action/downgrade:
A downgrade of Dai-ichi's ratings or change in Protective's strategic importance to Dai-ichi;
A deterioration in Protective's standalone credit profile, which could be driven by sustained deterioration in earnings or a material increase in risk profile or adverse experience with existing liabilities.
Best/Worst Case Rating Scenario
International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from '
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
Public Ratings with Credit Linkage to other ratings
ESG Considerations
Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg.
RATING ACTIONS
Entity / Debt
Rating
Prior
LT IDR
A
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A-
senior unsecured
LT
A-
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BBB+
subordinated
LT
BBB
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BBB-
Protective Life Global Funding
senior secured
LT
AA-
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A+
Ins Fin Str
AA-
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A+
Ins Fin Str
AA-
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A+
Ins Fin Str
AA-
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A+
Ins Fin Str
AA-
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A+
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