Market Overview

A.M. Best Affirms Credit Ratings of Milli Reasurans Turk Anonim Sirketi


A.M. Best has affirmed the Financial Strength Rating of B+ (Good)
and the Long-Term Issuer Credit Rating of "bbb-" of Milli Reasurans
Turk Anonim Sirketi
(Milli Re) (Turkey). The outlook of these Credit
Ratings (ratings) remains negative.

The ratings reflect Milli Re's consolidated balance sheet strength,
which A.M. Best categorises as strong, as well as its adequate operating
performance, neutral business profile and appropriate enterprise risk

The negative outlook reflects A.M. Best's view that high political and
financial system risks in Turkey could adversely impact Milli Re's
prospective earnings and consequently its balance sheet strength, as
well as the financial strength of its parent, Türkiye İş Bankası A.S.
(Işbank). Milli Re's consolidiated risk-adjusted capitalisation had been
under pressure, but at year-end 2017 stood at a very strong level, as
measured by Best's Capital Adequacy Ratio (BCAR), supporting an overall
balance sheet strength assessment of strong.

Milli Re's operating performance is adequate, demonstrated by a
five-year average operating ratio of 95% (2013-2017), with strong
investment earnings comfortably offsetting persistent underwriting
losses. Over the medium term, the company is expected to report a
combined ratio in line with its five-year average of 105%, with results
negatively affected by accounts in run-off, as well as intense
competition and regulatory changes in the Turkish market.

Milli Re has a strong market position in Turkey as the only locally
domiciled reinsurer. In addition, the company's profile benefits from
its association with Anadolu Anonim Turk Sigorta Sirketi, which
is the market leader in the country's direct insurance market.

This press release relates to Credit Ratings that have been published
on A.M. Best's website. For all rating information relating to the
release and pertinent disclosures, including details of the office
responsible for issuing each of the individual ratings referenced in
this release, please see A.M. Best's
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases

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