Research Update: Outlook On Cathay Group Units Revised To Stable From Negative On Restored Capital; Ratings Affirmed

Taiwan-based Cathay Life has restored its capital and reduced downward rating pressure over the past year through proactive asset liability management, effective market risk control, and the support of buoyant equity markets. We view Cathay Life as the flagship company of the Cathay FHC group. We are revising the rating outlook on Cathay Life to stable from negative and affirming the issuer credit rating and financial strength rating on the insurer. At the same time, we are taking similar outlook action on our ratings on Cathay United Bank (China), Cathay Century, and Cathay FHC, and affirming the ratings on the companies. We are also affirming our ratings on Cathay United Bank with a stable outlook, given our view of the

...- Taiwan-based Cathay Life has restored its capital and reduced downward rating pressure over the past year through proactive asset liability management, effective market risk control, and the support of buoyant equity markets. We view Cathay Life as the flagship company of the Cathay FHC group. - We are revising the rating outlook on Cathay Life to stable from negative and affirming the issuer credit rating and financial strength rating on the insurer. At the same time, we are taking similar outlook action on our ratings on Cathay United Bank (China), Cathay Century, and Cathay FHC, and affirming the ratings on the companies. - We are also affirming our ratings on Cathay United Bank with a stable outlook, given our view of the bank's core status to the group. - The stable outlook on the core units reflects our expectation that Cathay Life's improved capital is likely to sustain under the insurer's proactive risk management and the company's reduced capital consumption as it slows asset...

Research Update