Fidelidade Macau to retain earnings, strengthen capital

Fitch expects the risky-asset ratio to remain consistent.

Fidelidade Macau - Insurance Company Limited has a robust capital adequacy, sound profitability, and conservative investment practices, Fitch Ratings said.

As the sole non-life insurance carrier under the Fidelidade brand in Asia Pacific, divestment of the subsidiary is considered unlikely, and operational or capital support from the parent would be forthcoming if necessary.  

Its statutory solvency ratio stood at 693% as of September 2024, significantly exceeding the regulatory minimum of 150%. 

This was bolstered by a capital increase in May 2023, which incorporated MOP128m of free reserves into share capital, bringing the total to MOP288m. 

Fidelidade Macau may retain future earnings to strengthen its capital base further, particularly in anticipation of Macao’s upcoming risk-based capital regime.  

Despite a potential increase in equity investments to enhance yields, Fitch expects the risky-asset ratio to remain consistent with the insurer's current rating level.