Moody's says FTLife to maintain profitability

The ratings agency expects strong capital reserves, surpassing regulatory minimums.

FTLife's should maintain a stable outlook supported by its growing market share, strong capital position, and profitability track record. However, its relatively small operating scale compared to larger peers and high leverage at parent company NWS Holdings Limited partially offset these strengths, Moody’s Ratings said.

FTLife's annualised premium equivalent (APE) surged 176% for the twelve months ended December 2023, driven by strong insurance sales to mainland Chinese visitors. 

Moody's expects its capital position to remain robust, with solvency ratios well above regulatory minimum requirements.

Despite FTLife's low standalone financial leverage, its parent company's high leverage restricts its financial flexibility. 

ALSO READ: FTLife changes name to Chow Tai Fook Life

The stable outlook reflects Moody's expectation of FTLife maintaining its market position, profitability, and capitalisation over the next 12-18 months.

Moody's could upgrade FTLife's rating if its distribution and product capabilities strengthen further, profitability improves sustainably, financial discipline remains strong, and financial flexibility improves. 

Conversely, a downgrade could occur if financial flexibility deteriorates, capitalisation decreases significantly, market position weakens, or agency productivity declines persistently.

As of June 2023, its total assets amounted to HK$84.4b, with shareholders' equity totaling HK$11.6b.