OREANDA-NEWS. RusRating has assigned a credit rating to OOO Kompania 22 (Moscow). The rating is "BBB" on the national scale and "BB" on the international scale, in both cases with a stable outlook.

The rating is based on the good financial condition of the insurance company being purchased, in particular, its healthy asset quality, high capital adequacy, strong insurance reserves, sufficient liquidity and the absence of debt, as well as the Company’s own solid business ties to the owners of PromsvyazBank.

Constraining factors include a high anticipated debt burden and the insurance company’s relatively modest size.

OOO Kompania 22 is a limited liability company that at this time conducts virtually no business activity. Plans call for the acquisition of a controlling stake in the insurance company Solgasiye-Vita, which mainly provides life insurance to borrowers. The purchase will be financed by a loan from PromsvyazBank and is being undertaken on behalf of the bank’s beneficiary owners. Following the acquisition the insurance company will be renamed Drevo Zhizni [trs. Tree of Life] and will retain its current focus.

Capital adequacy at the insurance company is high, as are insurance reserves. Its assets consist of bank deposits, government debt and quality corporate bonds. Liquidity is judged sufficient and there is no debt. The insurance portfolio consists almost entirely of life insurance for borrowers. This line of business has typically been highly profitable, but the insurance company’s net profit margin is low due to high agency fees. Commission costs are expected to decline after the acquisition, with a positive impact on earnings.