Fubon Life Insurance Co. Ltd.

The stable rating outlook on Fubon Life reflects our view that the insurer will continue to drive the group credit profile, while other major subsidiaries maintain stable credit profiles. Fubon Life is likely to manage the negative impact of market volatility on its capital and earnings over the coming two years. We also anticipate the insurer will fulfill additional capital requirements without materially weakening its capital and earnings. These could include capital outlays to absorb volatility in the insurer's investment valuation, support overseas subsidiaries, and pursue further organic growth. Lastly, we believe Fubon Life can manage its forex risk by proactively adjusting its hedging, without tempering its capital adequacy. We could lower the long-term ratings on Fubon Life if the

...Fubon Life can maintain its established franchise, distribution channels, and market share locally. In our view, Fubon Life Insurance Co. Ltd. has broad business diversity and a well-diversified customer base and nationwide direct agent force compared with the industry average. The insurer's below-average expense ratio demonstrates the benefits associated its franchise and distribution channels, and is in line with that of large-sized local peers. Fubon Life's competitive position is unlikely to change significantly over the coming two to three years. Fubon Life has better earning resilience than its peers. The insurer's earnings in terms of its return on average assets have been consistently better than its domestic peers. Fubon Life has better interest surpluses than the domestic average, given the insurer's lower burden from negative spread and better investment gains. Fubon Life has also demonstrated earnings resilience with a good track record. We believe the insurer will maintain...

Full Report