Fitch Places Seguros e Inversiones y Filial S.A. on Negative Watch

SAN SALVADOR, El Salvador--(BUSINESS WIRE)-- Fitch Ratings has placed on Rating Watch Negative the Insurer Financial Strength ratings of 'BB' on the International scale and 'AAA(slv)' on the National scale of Seguros e Inversiones y Filial, S.A. (SISA). SISA's parent company is Citigroup, Inc.

This action follows the Dec. 21, 2015 announcement that Citigroup in El Salvador, which does not include Citibank, N.A., has agreed to sell its insurance and consumer and commercial banking operations to Terra Group (not rated by Fitch). The transaction is subject to approval by El Salvador regulators.

Terra Group is a conglomerate based in Honduras that participates in several key industry sectors of Central American economies as well as in some South American countries. Terra Group has a track record of 37 years with investments in El Salvador since 2008, but this will be its first incursion into the financial and insurance sector.

KEY RATING FACTORS

According to Fitch's Financial Groups Criteria, the current ratings are based on the potential support that SISA and its subsidiary would receive from its shareholders if needed. The agency believes that Citigroup (Fitch international scale rating 'A'/Outlook Stable) has the financial capacity to support these subsidiaries. In Fitch's view, support from Citigroup will be forthcoming until the transaction is approved by regulators.

SENSITIVITY OF RATINGS

Fitch's decision to place SISA and its subsidiary on Rating Watch Negative indicates that the companies' ratings will no longer benefit from the financial strength of Citigroup once the transaction is completed. Upon the completion of the acquisition by Terra Group, SISA will be rated strictly on the basis of their own financial profiles.

Fitch has taken the following rating actions on SISA:

--Fitch National scale IFS rating of 'AAA(slv)' placed on

Rating Watch Negative;

--Fitch International scale IFS rating of 'BB' placed on Rating Watch Negative.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria

Insurance Rating Methodology (pub. 16 Sep 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=871172

Metodologia de Calificacion de Seguros (pub. 13 Oct 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=871185

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=997346

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20151223005736/en/

Fitch Ratings
Primary Analyst
Eugenia Martinez, +52 82 8399 9155
Associate Director
Prol. Alfonso Reyes No. 2612, Edificio Connexity
Piso 8, Col. Del Paseo Residencial,
Monterrey, Nuevo Leon, 64920, Mexico
or
Secondary Analyst
Riccardo Caruso, +503 2516-6621
Analyst
or
Committee Chairperson
Eduardo Recinos, +503 2516-6606
Senior Director
or
Media Relations:
Elizabeth Fogerty, New York, +1 212-908-0526
[email protected]

Source: Fitch Ratings

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