Sony’s captive downgraded
Sony’s captive has had its financial strength rating downgraded to A- (excellent) from A and issuer credit rating downgraded to ‘a-‘ from ‘a’.
Bermuda-domiciled PMG Assurance was given a negative outlook for both ratings by AM Best.
The captive’s downgrades reflect the overall change in Japan-based Sony Corporation’s credit risk profile.
AM Best described Sony Corporation’s credit risk profile as having “significantly decayed” in the last year, which naturally impacts PMG’s ratings due to the company’s relationship with its subsidiary.
“While PMG exhibits continued strong capital strength, its risk profile is compromised as a captive for Sony Corporation,” said AM Best.
The captive is an integral part of Sony’s risk management platform. AM Best said: “The third-party credit ratings as well as market based credit risk measures of Sony Corporation, indicates negative rating pressure on PMG.”