Utmost Group said today (6 June) that Fitch Ratings has upgraded the Group’s Insurer Financial Strength (IFS) Ratings to ‘A+’ from ‘A’.

Simultaneously, Fitch has upgraded the Group’s Long-Term Issuer Default Rating (IDR) to ‘A’ from ‘A-’. Both IFS and IDR outlooks are Stable.

The Group’s Restricted Tier 1 and Tier 2 notes have been upgraded from ‘BBB-‘ to ‘BBB’.

In a statement, Utmost said: "The upgrade reflects the Group’s strong financial strength and improved business risk profile following the completion of the Quilter International integration.

"Fitch’s assessment highlighted the strong operating performance and scale of the Group as a leading business franchise in the international life and savings market, underpinned by an ‘Extremely Strong’ capital and leverage position."

In its report Fitch said: "The group has an established record of adequately managing execution risks associated with integrating acquired businesses. Acquisitions of international and investment bond businesses from several European insurance groups, and closed books in the UK have supported the notable improvement in the group's operating scale over the past few years.

"Fitch expects the group's planned entry into the UK bulk annuity market to provide diversification and scale benefits, although it believes that these will likely be realised more gradually over the medium to long term."

Fitch also drilled down into how Utmost Group has a leading business franchise in the international life and savings market, focusing on servicing affluent, high-net-worth and ultra-high-net-worth individuals.

"It is the market leader in this segment, with total assets under administration (AUA) of GBP62.8 billion at end-2023, up from GBP60.1 billion at end-2022. The increase was mainly supported by favourable market value movements but partly offset by GBP0.6 billion net outflows during the year due to challenging macroeconomic conditions. Fitch expects net flows to remain volatile in the near to medium term as clients remain selective in investing in a volatile investment climate.

"The group also provides employee benefits insurance to multi-national corporates through Utmost Corporate Solutions and has acquired closed life insurance books in the UK through its Utmost Life and Pensions subsidiary. The group's intended entry into the UK bulk annuity market will be through Utmost Life and Pensions."

Fitch's full report can be read here.