Enterprise risk management remains a focus for Vietnam National Reinsurance Corporation (VINARE), as AM Best affirms its credit ratings and cites the company’s structured approach as a key factor in navigating complex reinsurance exposures.
In its latest review, AM Best affirmed VINARE’s Financial Strength Rating of B++, Long-Term Issuer Credit Rating of “bbb+,” and Vietnam National Scale Rating (NSR) of aaa.VN. The outlook for all ratings is stable. The ratings reflect the company’s financial position, performance trends, and the suitability of its risk oversight mechanisms.
VINARE’s capital adequacy, measured through AM Best’s Capital Adequacy Ratio (BCAR), is expected to remain at the strongest level over the medium term.
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The company's regulatory solvency ratio continues to exceed minimum requirements, providing a capital buffer against underwriting volatility.
However, VINARE’s portfolio includes moderate investment risk due to its equity exposures and a high dividend payout ratio. The company’s use of retrocession to underwrite large commercial risks introduces additional risk, though this is partially offset by the financial strength of its reinsurance counterparties.
VINARE’s operating performance between 2020 and 2024 delivered an average return on equity of 10.6%.
In 2024, the company reported a combined ratio of 96.8%, driven by lower operating expenses. This was partially offset by a rise in the loss ratio following Typhoon Yagi, which struck in September 2024.
Net investment yield remained strong at 7.8%, continuing to play a central role in overall earnings.
AM Best projects that VINARE will sustain consistent financial results, supported by its commercial underwriting lines and steady investment income.
VINARE, as the national reinsurer of Vietnam, maintains long-standing relationships with local cedants and writes most of its business in the domestic market. The company underwrites a range of reinsurance products including property, construction, machinery, marine, aviation, energy, and life insurance. Its portfolio is diversified across commercial and retail risks but remains exposed to product risks associated with large-scale industrial coverage.
As of May 9, VINARE's shares were trading at US$0.86, giving the company a market capitalization of US$157 million, based on 182 million outstanding shares.
AM Best described VINARE’s enterprise risk management as appropriate for the scale and complexity of its operations. The framework benefits from a formalized structure and ongoing technical support from Swiss Reinsurance Company Ltd., which holds the second-largest shareholding in the company.
Swiss Re is one of the world’s largest reinsurance companies based on GPW. Read more here.
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