S&P raises Kazakh insurer Sinoasia B&R to BB+ with a stable outlook

S&P Global Ratings raised Sinoasia B&R Insurance, a Kazakh general insurer owned by Bank CenterCredit, to BB+ from BB on 23 October with a stable outlook, the company told the Kazakhstan Stock Exchange on 28 October.

The agency raised both the long-term issuer credit rating and the insurer financial strength rating on the international scale, and lifted the Kazakh national scale rating to kzAA from kzAA-, its rationale, published in Russian on the exchange's site, says. Before the action both ratings stood at BB with a positive outlook. The stable outlook reflects the agency's expectation that over the next 12 months the insurer keeps steady operating results through its continued ties with the parent bank, and that capital adequacy stays above the 99.99 per cent confidence level.

Returns above the market

S&P says the upgrade reflects the insurer's successful execution of its strategy since Bank CenterCredit bought it, with steady operating results, a more diversified business and higher capital. Over 2023 to 2025 its average return on equity was 42.7 per cent, against 16.8 per cent for Kazakhstan's general insurance market, and its average combined ratio was 72.7 per cent, below the sector's 82.2 per cent. On that record the agency no longer applies the one-notch negative adjustment it had used in its comparable ratings analysis.

About 60 to 70 per cent of gross written premiums come through the bank's network, mostly in voluntary motor and property lines, and S&P expects the bank to account for more than 70 per cent of the insurer's sales over the next few years. At 1 September 2026 gross premiums were about KZT 25 billion (about $54 million), roughly 4.3 per cent of the market, placing the company seventh among Kazakhstan's general insurers. The agency names the dependence on the parent's bancassurance channel as a concentration risk, and the move beyond medical insurance as a source of new risks where the company has limited experience.

Capital built from retained profit

Total capital rose from KZT 19.0 billion ($36.2 million) in 2024 to KZT 30.0 billion ($60.0 million) in 2025, driven mainly by operating results and the retention of KZT 10.3 billion of net profit, and reached KZT 40.9 billion ($88.4 million) after the first eight months of 2026 on net profit of KZT 10.6 billion ($22.9 million), the rationale says. S&P counts the parent's zero dividend policy as support for capital and does not expect dividends in the period to 2028. The exchange's issuer page shows equity of KZT 38,175,635 thousand and total assets of KZT 83,682,112 thousand at 1 July 2026, with net income of KZT 7,914,882 thousand for the first half.

For 2026 to 2028 the agency forecasts revenue growth of 18 to 25 per cent, a combined ratio of 70 to 80 per cent and return on equity of 25 to 35 per cent. It expects capital to stay below $1 billion over the next two years, and says the small absolute size of capital could limit the insurer's ability to cover large losses or fund fast expansion without more support from its parent. That keeps its assessment of capital and earnings at "strong" rather than higher. The investment portfolio holds mainly Kazakh sovereign and quasi-sovereign bonds and short-term reverse repos backed by government bonds, with average credit quality in the BBB category, and the debt burden was 1.8 per cent in 2025.

Capped by the parent

S&P treats Sinoasia B&R as a strategically important subsidiary of Bank CenterCredit, which it rates BB+ with a positive outlook. The insurer makes up less than 5 per cent of the group's assets and of its capital, and its ratings are capped by the group credit profile at bb+, the agency says. Any further upgrade depends on its view of the bank, and on the insurer showing it can keep capital above $100 million with capital adequacy well above the 99.99 per cent confidence level, or strengthening its competitive position. A downgrade could follow sustained volatility or a fall in profitability against peers, a lasting drop in capital adequacy below that level, or a weaker risk profile.

The parent has its own business before shareholders: Bank CenterCredit has called a 25 November vote on an Islamic banking licence. The insurer's bond holdings sit in a local market that J.P. Morgan has placed on its index watch list.