A.M. Best has downgraded the issuer credit rating to “bbb” from “bbb+” and affirmed the financial strength rating of B++ (Good) of BTG Pactual Resseguradora S.A. (BTG Pactual Re) (Brazil).

Both ratings have been placed under review with negative implications.

BTG Pactual acquired Ariel Re in 2014.
The rating action follows the recent news related to the resignation and investigation of former chairman and CEO of BTG Pactual Re’s parent, and the subsequent deterioration of the BTG Pactual group’s credit profile and liquidity metrics. In addition to the impact of the decline in the parent’s credit profile, A.M. Best has concerns regarding the existing risk management and governance structure within the BTG Pactual organization, which could adversely impact BTG Pactual Re’s ratings going forward.

The under review status will be removed once A.M. Best can complete its assessment of any further impact of these recent events on the ratings of BTG Pactual Re.

Source: A.M. Best