SA-based Global Credit halts Prime Bank’s Tausi Assurance rating

South Africa’s ratings firm Global Credit Ratings (GCR) has suspended the credit profile of Prime Bank’s Tausi Assurance company for failing to disclose some information.

GCR says the A rating issued after a review in October 2019, indicating high credit quality and certainty of timely payments, has been withdrawn.

The ratings firm, however, said this did not mean the company is not paying its debt or struggling to stay afloat.

“GCR has suspended Tausi Assurance Company Limited’s national scale financial strength rating of A(KE) without review. No information has been received and therefore a review of the ratings cannot be finalised based on GCR’s information sufficiency standard requirement,” GCR said.

“A credit rating suspension does not imply that the entity is not servicing its debt obligations or that its financial position has deteriorated, but rather that it has failed to provide important information pertaining to its credit profile,” the ratings firm said.

Tausi has, however, denied that GCR withdrew its ratings for failure to disclose information saying it cancelled the ratings contract with GCR in May last year and hence had no obligation to disclose any information with the firm.

Prime Bank bought Tausi Assurance in 2018 in a takeover that saw the lender gain 80.7 per cent control of the insurance solutions provider.

The acquisition was meant to help the lender scale up to offer its customers a wide range of insurance solutions through the bank’s network.

Established in 1992, Tausi Assurance covers all industrial risks, fire, business interruption, engineering, burglary, marine, workmen’s compensation and group personal accident.

The firm also offers cover against loss emanating from political violence and terrorism, domestic insurance and motor vehicle accidents.

*This story has been updated to include Tausi's comment on GCR’s credit rating action.