Fitch Improves Pacifico Peruano’s Outlook

Fitch has improved to stable from negative the outlook for insurer Pacifico Peruano Suiza (PPS) and affirmed its BBB minus rating. The action reflects the improvement on PPS’ operating performance, which is sustained by a significant reduction of its claim ratio and controlled operating expenses while its leverage ratios are decreasing towards its historic average, Fitch says. It also reflects its adequate retention levels, solid market share and franchise in Peru and its association with the largest and dominant financial conglomerate, Credicorp. A capital injection made on late 2008 early 2009 of around $18m, the decision to stop cash dividends and the recovery of the losses of 2008, resulted in an improvement of the liabilities to equity ratio to 1.6x, from a high of 2.2x at the end of 2008.