SOUTH SUDAN – Global Credit Ratings (GCR) has downgraded UAP Insurance South Sudan and accorded it a negative outlook.
The South African-based agency cited worse than anticipated performance negatively impacted by the uncertain economic and political environment. This is in contrast to stable outlooks accorded to UAP Insurance Kenya and Uganda by the agency in July, Business Daily Africa reported.
The wholly-owned subsidiary of UAP Holdings commenced its South Sudan operations in February 2006 in Nairobi before moving to Juba in July of the same year.
GCR said in a statement it had downgraded the national scale claims paying ability rating assigned to the insurer to BBB-(SS) from BBB+(SS), with outlook accorded as negative. The new rating is valid until August, 2018.
“There is, therefore, a higher risk that the payback period of sizeable loans to the subsidiary, which are subordinated to external loans, could be prolonged beyond the short term nature of predominant liabilities,” said GCR.