Insurance
Ratings
COFACE SA
Long-Term Foreign-Currency IDR A
Short-Term Insurer Financial F1
Strength Rating
Compagnie française d’assurance pour le commerce extérieur
Long-Term Foreign-Currency IDR A+
Insurer Financial Strength Rating AA−
Short-Term Insurer Financial
Strength Rating
F1+
See page 13 for subsidiaries ‟ ratings
Sovereign Risk
Long-Term Foreign-Currency IDR AA+
Long-Term Local-Currency IDR AA+
Outlooks
Long-Term Foreign-Currency IDR Stable
Insurer Financial Strength Rating Stable
Sovereign Long-Term IDRs Stable
Financial Data
COFACE SA
(EURbn)
Total assets
Total equity
GWP
Net combined ratio (%)
Net profit (EURm)
Solvency margin (x)
2013
5.99
1.8
1.2
93
127 n/a
2012
6.07
1.8
1.3
89
124
6.8
Leading Business Position: With gross written premiums (GWP) of EUR1.2bn in 2013,
Compagnie française d‟assurance pour le commerce extérieur (Coface; the main operating entity of the Coface group) is the third-largest credit insurer worldwide. The group holds an estimated 20% market share in the credit insurance industry, and operates in more than 60 countries and in multiple economic sectors.
Sound Underwriting Performance: In 2013,
Coface‟s underwriting performance deteriorated slightly but remained sound. This is reflected in a Fitch Ratings-calculated net combined ratio of
92.7% for the group in 2013, somewhat higher than 89% for 2012, mainly driven by a higher expense ratio due to additional reinsurance protection and higher administrative and acquisition costs. Fitch expects
Coface‟s underwriting performance to remain strong in 2014.
Strong Solvency: Fitch considers the Coface group to be strongly capitalised, both on the agency‟s own risk-adjusted capital basis and from the perspective of regulatory solvency, which at end-2012 was 6.8x the minimum required. Fitch expects Coface ‟s solvency to have remained strong in 2013, even after the distribution of EUR65m of interim dividends to parent company Natixis (Long-Term IDR: A/Stable).
Solid Earnings: For 2013, Coface reported net income of EUR127m (2012: EUR124m). The slight deterioration in underwriting performance was offset by a material increase in the group‟s financial results, including EUR28m of realised capital gains compared with a realised loss of
EUR7m in 2012.
Adequate Risk Profile: Fitch considers
Coface‟s risk profile to be adequate despite the close correlation of its activities with the macroeconomic environment. The group benefits from high flexibility to adjust the terms and conditions of its policies and concentrates on short-tail business; almost 100% of its bond investments are investment-grade, and cash and cash equivalents represent 35% of total investments.
Increased Financial Leverage: Fitch expects Coface‟s financial leverage to materially increase to about 20%, once the insurer completes the subordinated note issuance announced in March 2014. Despite this, Coface‟s financial leverage is expected to remain within the median bounds for a
„AA‟ IFS rating. Fitch views the debt issuance as being consistent with the group‟s decision to become financially independent from Natixis.
New Shareholder: A rating upgrade could be triggered by a new, financially stronger shareholding structure in which Coface
‟s strategic importance increased at the same time as the group ‟s standalone financial profile remaining strong.
Standalone Credit Deterioration: The ratings could be downgraded if capital is extracted by
Natixis, or if Coface ‟s standalone profile deteriorated as a result of increased insolvencies, leading to a combined ratio above 100% for a prolonged period and a material fall from current capital levels. Analysts
Amelie Hibos
+33 1 44 29 91 78 amelie.hibos@fitchratings.com
Marc-Philippe Juilliard
+33 1 44 29 91 37 marcphilippe.juilliard@fitchratings.com www.fitchratings.com 20 March 2014

Insurance
Figure 1
Western Europe
Germany, Western &
Northern Europe
Africa, Middle East, Italy,
Turkey & Greece
Asia Pacific
Central Europe
Latin America
North America
Total
Source: Coface
30
20
14
14
8
7
8
100
Figure 2
Factoring
5%
Public procedures
5%
Debt collection
& Services
7%
Credit Insurance
83%
Source: Coface
Figure 3
Asia
Latin Pacific
America 7%
North 5%
America
7%
Med. countries
& Africa
15%
Central
Europe
8%
Northen
Europe
25%
Western
Europe
33%
Source: Coface

Strong presence worldwide

Focus on credit insurance

Niche player but well diversified by sector and geography

Short-tail business, flexible policies
With EUR1.2bn of GWP in 2013, Coface is the third-largest credit insurer worldwide, accounting for an estimated 20% market share within this business line. It operates predominantly in France, Italy, Germany and North America. The company has a strong presence in more than 60 countries and employs around 4,500 staff.
In 2012 , Coface‟s strategy remained focused on its credit insurance activities (80% of total revenues). The group has retained certain other activities, including credit information, debt collection and factoring (notably in Poland and Germany), but only those that add value to its core business.
Despite being a niche player, Coface is well diversified by sector and geography, with no particular concentrations. The company operates through a direct sales network in 66 markets
– and 97 markets when including partnerships. Product distribution channels vary according to the country of operation. In 2012, direct sales networks and tied agents represented 41% and
34% of Coface total‟s sales force respectively, but more than half of its business is introduced by brokers.
Coface‟s business consists mainly of short-tail business where the risk is borne by the insurer for up to 180 days. Coface benefits from high flexibility to promptly adjust the terms and conditions of its policies and to impose stricter underwriting practices, which enabled the group to recover quickly during the financial crisis in 2008-2009.
Figure 4
AAA
AA
AA
A
A
BBB
IFS Rating category
Senior debt rating category
Large market position and size/scale
Medium market position and size/scale
Small market position and size/scale
Source: Fitch
BBB
BB
<BBB
<BB
Related Criteria
Insurance Rating Methodology
(November 2013)
COFACE SA
March 2014
2

Insurance
Corporate Governance and
Management

Corporate governance and management are considered adequate and neutral to the rating.

KPMG and Deloitte are
Coface‟s auditors. The opinion for 2012 was unqualified. Coface reports under the
IFRS framework.
 Coface‟s supervisory board has 13 members and the managing board has 14 members. The company is governed by the French insurance
Code. The Autorité de Contrôle
Prudentiel (ACP) is its main regulator as the company is headquartered in
France.
Coface is 100% owned by Natixis, which had been a minority shareholder for many years through the former Banque Française de Commerce Extérieur.
Fitch considers Coface to be of limited strategic importance to its parent company, Natixis.
Natixis intends to dispose gradually of Coface in 2014 by means of an IPO. Nevertheless, the agency does not rule out the possibility of capital support being provided by Natixis if the need arises. The Coface group legal structure (Figure 5) shows the group‟s key operating subsidiaries (excluding sub-holdings).
Figure 5
0.2%
Natixis
100%
COFACE SA
99.8%
Compagnie Françaised‟ Assurance pour le Commerce Extérieur
100% 100%
Coface
Finanz
Coface
Poland
Factoring and its credit insurance subsidiaries:

Germany

Austria

Italy

United Kingdom

Spain

Hong Kong

Singapore

Australia
 etc.
CNAIC
100% 100%
Coface
SeguroCredit oMexico
Coface
Chile
100% 75.8% Seguradora
Brasileira
C.E.
Coface
Sigorta
Turkey
100% 100%
Coface DO
Brasil
Coface
South
Africa
100% 100% Coface Rus
Insurance
Credit Insurance
Factoring
Source: Transaction documents
COFACE SA
March 2014
3

Insurance
Sovereign and Country-Related
Constraints
 Fitch rates France „AA+‟ with a
Stable Outlook, and the Country
Ceiling is „AAA‟. The ratings of
French insurance organisations and other corporate issuers are not directly constrained by sovereign or macroeconomic risks.
A number of factors had a negative impact on the operations of corporates during 2012.
Political and economic disturbances in Africa (Tunisia, Egypt), the Middle East (Turkey, Syria) and South America, weaker economic growth in Europe, Russia and China, new regulations –
Basel III, Solvency II
– and limited funding options in the financial markets had a positive effect on demand for credit insurance as an increase in risk awareness led to greater demand for coverage.
Total insured exposure in trade credit insurance increased by 4.4% to EUR1.92trn at end-2012 from EUR1.84trn at end-2011. Demand slightly increased to EUR6.14bn (excluding reinsurance) at end-2012 from EUR5.96bn at end-2011, according to the International Credit
Insurance and Surety Association. Underwriting in terms of risk selection and pricing has also become more complex for the credit insurance industry.
The high level of competition in the market
– particularly from governmental export credit agencies and new capacity available in the London market – has kept prices low; meanwhile risks appear to be higher. Claims paid for the credit insurance sector deteriorated by 12% to
EUR2.93bn at end-2012 from EUR2.62bn at end-2011, mainly explained by insolvencies in
Europe.
Demand for trade credit insurance continued to increase in 2013 in Asia, Latin America
(especially Brazil), Africa (Angola, Mozambique), Gulf region countries, Russia and the US.
Figure 6
IFS Rating
Debt
Non-life insurance
AAA
AA
AA
A
A
BBB
BBB
BB
<BBB
<BB
Source: Fitch
Three major European groups
– Euler Hermes, Atradius and Coface – dominate the market internationally, with an estimated combined market share in 2012 of around 80%. Credit insurers faced weaker economic conditions that negatively affected their underwriting performance in 2012. Even so, Fitch considers their earnings to have remained solid.
Coface‟s financial performance compares well with peers‟, as shown in Figure 7.
COFACE SA
March 2014
4

Insurance
Figure 7
(EURm)
Total turnover
Gross earned premiums
- % of turnover
Other revenues (services income)
- % of turnover
Retention rate (%)
Net earned premiums
Net loss ratio (%)
Net expense ratio (%)
Reinsurance commission ratio (%)
Net combined ratio (%)
- Average last 5 years (2009-2013; %)
Consolidated net income
Euler Hermes (NR) Atradius (NR) Coface (IFS: AA−) Sace BT
2011 2012 2013 2011 2012 2013 2011 2012 2013 2011 2012 2013
2,275 2,398 2,486 1,554 1,602 1,578 1,607 1,584 1,440
1,896 1,995 2,079 1,403 1,440 1,412 1,217 1,251 1,129
83
379
17
83
403
17
84
407
16
65 68 70
1,220 1,344 1,436
90
151
10
55
768
90
162
10
55
786
89
166
11
54
770
76
216
13
68
841
79
205
13
72
893
78
187
13
74
888
45
48
-19
75
330
52
47
-18
81
300
51
44
-16
80
85
314
56
68
-30
95
130
55
67
-26
97
117
53
70
-28
94
105
135
59
49
-13
94
74
57
45
-13
89
117
57
48
-12
93
102
106
63
100
0
0
59
63
54
46 n-a
100
0.2
83
54
100
0
0
65
55
62
55 n-a
116
-22 n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a
Net loss ratio = Net claims incurred/net premiums earned; Net expense ratio = Acquisition costs + administrative expenses/net premiums written;
Net combined ratio = Net loss ratio + net expense ratio+ reinsurance commission ratio. Expenses and income from other services are not included in the calculation of technical ratios. Since 2008, Atradius has included CyC; Coface excludes Natixis Factor
Source: Fitch, Annual reports Euler Hermes, Atradius and Coface
COFACE SA
March 2014
5

Insurance
Figure 8
(x)
Regulatory capital ratio
Net premiums written/equity
Gross leverage
Net leverage*
Financial leverage (%)
Total financing & commitments ratio
2009
3.7
0.7
6.2
5.7
39
4.2
2010
5.8
0.6
5.3
4.8
33
3.3
2011
5.9
0.6
4.7
4.2
3
2.4
2012
6.8
0.5
3.1
2.7
1
1.3
2013 Fitch ’s expectation n/a Fitch expects Coface to maintain strong
0.5 capital levels. The agency anticipates that
2.8
2.6 financial debt leverage will increase following the issuance of subordinated
1
1.4 debt, but this will not have a negative impact on the insurer‟s rating. Fitch expects the TFC ratio to remain stable.
* The ratio is calculated by dividing the sum of net premiums written and total liabilities, less any ceded reserves, by equity
Source: Fitch, Coface

Strong regulatory capital

Limited-use factors protect capital

Increased financial leverage

Stable TFC ratio
Fitch views Coface‟s regulatory capital as strong, at 6.8x the minimum required at end-2012.
Fitch-calculated total adjusted equity (including minority interests and unrealised capital gains) increased to EUR1.8bn at end-2012 from EUR1.5bn at end-2011, reflecting retained earnings over the past three years.
Limits granted by Coface are not fully used by its clients; there is an average use factor of no more than 30%, which further contributes to capital protection. Indemnification is usually capped at 85%-90% of the loss, and each policy has a maximum liability.
Fitch expects Coface‟s financial leverage to materially increase to about 20% due to the group‟s intention to issue subordinated notes, announced in March 2014, but to remain in line with the Fitch „AA‟ category IFS rating median. The agency views the debt issuance as being consistent with Coface‟s stated intentions to become financially independent from Natixis.
At end-2013, financial leverage remained unchanged year on year at a low 1%. This contrasts with the higher levels reported at end-2009 and end-2010. The significant decrease at end-
2013 can mainly be explained by a material decrease in banking liabilities following the disposal of Coface Finans AS Denmark and the run-off of seven other factoring companies. In contrast, Coface completed a securitisation programme of EUR1.1bn in March 2012 and set up a EUR250m commercial paper facility in October 2012, which was extended to EUR500m in
October 2013.
Coface‟s TFC ratio remained stable at 1.4x at end-2013, compared with 1.3x at end-2012. This indicator is higher than the peer average, but this can be explained by the group‟s factoring operations. Fitch considers Coface‟s access to external financing as to be good, as demonstrated by the establishment of the EUR500m commercial paper facility mentioned above.
COFACE SA
March 2014
6

Insurance
Figure 9
(x)
Fixed-charge coverage ratio
(excluding realised and unrealised capital gains)
2009
-26.2
2010 2011
26.4 25.4
2012 2013 Fitch
’s expectation
66.2 53.7 Fitch expects Coface‟s fixed-charge coverage ratio to materially decrease to about 8x, due to an increase in interest payments arising from the group‟s intention to issue subordinated notes, announced in March 2014.
Source: Fitch, Coface
Holding Company Liquidity/
Bank Facilities
In October 2013, the group had available liquid assets and undrawn committed facilities of EUR500m to back up the commercial paper issue.
These back-up credit lines were provided by high-credit-quality banks including: Société Générale (A/Stable),
Crédit Agricole (A/Stable), Natixis
(A/Stable), HSBC (AA −/Stable), Royal
Bank of Scotland (A/Stable),
Commerzbank (A+/Stable) and BRED
Banque Populaire (A/Stable).

Low coverage ratio

Access to external financing

Limited reliance on Natixis for additional funding
Fitch expect s Coface‟s fixed-charge coverage ratio to materially decrease to about 8x, which is marginally below the Fitch „AA‟ category IFS rating median, due to an increase in interest payments arising from the group‟s intention to issue subordinated notes, announced in March
2014. The agency will monitor the evolution of this ratio carefully.
Coface‟s coverage ratio remained strong at 54x at end-2013, down from 66x at end-2012.
Fitch considers Coface to have adequate access to external funding. This was proved by the
EUR1.1bn securitisation programme completed in 1Q12 through FCT Vega (securitisation fund) and the EUR250m commercial paper facility arranged by COFACE S.A. in October 2012 and extended to EUR500m in October 2013 to replace funding provided by Natixis and to support Coface
‟s factoring business.
Overall, Fitch views Natixis‟ ownership as neutral to Coface‟s ratings, and considers Coface‟s strategic importance to Natixis to be limited. Given Natixis ‟ weaker financial profile, Fitch believes that its ability to provide support to Coface if needed would be constrained.
COFACE SA
March 2014
7

Insurance
Figure 10
(%) 2009 2010 2011 2012 2013 Fitch ’s expectation
Return on adj. equity (incl. gains)
Combined ratio
Expense ratio
Claims ratio a
Reinsurance ratio b
-14
139.3
38.7
109.7
9.1
8.9
95.6
46.4
58.2
9.1
5.7
94.2
48.8
58.5
13.0
7.7
88.7
45.3
56.5
13.1
7.0 Fitch expects Coface to achieve better
92.7 technical results, in line with the group‟s
48.4 stricter underwriting guidelines and manageable claims development in 2013.
56.6
12.2 a
Expense ratio = (acquisition costs+ admin costs+ other expenses – premium-related revenues – public procedure expenses) / net earned premiums b
Reinsurance ratio = reinsurance commission / net earned premiums
Source: Fitch

Solid and increasing earning

Sound underwriting performance

Reduced exposure to certain countries

Selective risk acceptance
For 2013, Coface reported net income of EUR127m (2012: EUR124m). The slight deterioration in its underwriting performance was offset by a material increase in the group‟s financial results, including EUR28m realised capital gains compared with a realised loss of EUR7m in
2012.
The group‟s underwriting performance decreased slightly in 2013, as reflected in a higher net combined ratio.
Coface‟s net combined ratio deteriorated to 92.7%, mainly explained by an increase in the group‟s expense ratio due to additional reinsurance protection and higher administrative expenses. Nevertheless, the group‟s claims ratio remained stable compared with
2012 as it implemented a new risk underwriting organisation, increased its number of risk underwriting centres and revised its risk portfolios, reducing its limits to certain countries exposed to high frequency claims, especially Italy. Fitch expects Coface ‟s underwriting performance to remain sound in 2014.
Fitch expects
Coface‟s technical performance to have improved further in 2013 as a result of measures taken to reduce exposure to several countries/regions, including Italy, Egypt, Latin
America and Asia where the group has reduced most of its higher-risk exposure to prevent adverse claims development. Coface also plans to reduce limits in Poland, the Netherlands and
South Africa.
Fitch considers Coface‟s exposure by level of risk to be adequate, with 89% of the group‟s exposure focused in highly rated risks, as measured by Coface‟s internal risk assessment system. Furthermore, the risk acceptance rate used by the company does not exceed 18% for the lower-rated credit category.
COFACE SA
March 2014
8

Insurance
Figure 11
(x)
Unaffiliated common stocks/equity
Risky assets a
/equity (%)
Liquid assets/technical reserves (%)
2009
0.1
0.1
170
2010
0
0.1
185 a
Risky assets include sub-investment-grade bonds, equities and affiliates
Source: Coface, Fitch
2011
0
0.1
191
2012
0
0.1
213
2013 Fitch ’s expectation
0 Fitch does not expect any material change
0.1 in Coface‟s investment strategy, which is
234 currently focused on fixed-income assets.

Excellent liquidity

Good quality of bond investments

Mainly exposed to European Economic Monetary Union (EMU) and North American bonds

Short-tail assets and liabilities

A centralised investment platform
Fitch considers Coface‟s liquidity to be excellent, with EUR939m of cash at end-2012, representing 35
% of the group‟s total investment portfolio. Liquidity is strengthened by the high quality of the investment portfolio, reflecting the quality of the assets held and the holding of mutual funds rather than the underlying instruments.
The credit quality of
Coface‟s bond portfolio remained strong at end-2012, mainly comprising high-quality assets, but with a growing proportion of weaker, potentially higher-yielding, investment-grade bonds compared with 2011. Of the total bond portfolio, 85% was rated at least „A−‟, of which 29.4% was rated „AAA‟, 55.8% was rated „AA‟ to „A‟, and 14.6% was rated in the „BBB‟ category.
In 2013, Coface remained mainly exposed to European EMU bonds (at 66.5% of its total bond portfolio, up from 78% in 2012) and increased its exposure to North American bonds (to 18%, from 8% in 2012). Fitch considers
Coface‟s remaining exposure to Italy to be moderate in accordance with the activities it runs in this country. T he group‟s exposure to Italian government bonds accounted for 6% of its total bond exposure.
Coface‟s global portfolio‟s modified duration reduced to 2.4 years at end-2012 (end-2011: 2.9 years). Fitch considers the asset duration to be in line with the company‟s short-tail liabilities.
Coface has reorganised and centralised its investment policy. The company outsources administrative services such as middle- and back-office management, reporting to Amundi, a leading European asset manager, through an international platform. Coface remains in charge of its overall asset allocation.
COFACE SA
March 2014
9

Insurance
Figure 12
(%)
Non-life technical reserves/non-life NPW
Non-life claims reserves/non-life NPW
Source: Fitch
2009 2010 2011 2012 2013 Fitch ’s expectation
119 117 132 120 119 Fitch expects Coface to maintain adequate reserve levels to meet its
98 95 107 95 93 policyholder obligations. The agency expects prior-year reserve releases to continue supporting profits reported.
Coface‟s reserving practices have proved favourable since 2003 (excluding underwriting year
2008). Fitch does not expect any changes in reserving practices and believes that the group
‟s conservative reserve levels will continue to strengthen profitability through reserve releases in the coming years.
COFACE SA
March 2014
10

Insurance
Figure 13
(%)
Net premiums written/gross premiums written
Reinsurance recoverables/equity
Source: Fitch
2009
77
22
2010
72
12
2011
68
8
2012
72
10
2013 Fitch ’s expectation
74 Fitch expects Coface to maintain its level of
8 reinsured premiums and keep a conservative level of reinsurance programmes.

High reinsurance utilisation smooths profitability through the cycle

Centralised reinsurance at group level, global view of risks

Conservative level of reinsurance programmes

High quality of reinsurance providers
Fitch views positively Coface‟s high use of reinsurance, with 26% of GWP ceded to reinsurers in 2013 (28% in 2012), as it could serve to smooth profitability in times of financial disturbance.
Coface‟s reinsurance policy is centralised at the group level, with a view to mitigating aggregated losses through a quota-share treaty and excess-of-loss cover, and protecting individual subsidiaries through internal stop-loss programmes. This provides a global view of the entire group, enabling appropriate measures to be taken quickly.
In 2013, the group added another layer to its excess-of-loss treaty per debtor and implemented a new excess-of-loss treaty per country for single risk.
The company‟s quota-share treaty remained unchanged . Deductibles are adjusted annually in relation to both the group‟s net assets and the net annual probable maximum loss, taking into account internal sharing mechanisms (at a 99% confidence level). Reinsurance programmes are structured so that no more than 3% of the group‟s total adjusted equity is at risk (net of taxes), which Fitch views as a conservative level.
The quality of the reinsurance panel is satisfactory: core providers are in the „AA‟ and „A‟ rating categories. The group‟s main reinsurance providers are: Hannover Rueck SE (IFS Rating:
A+/Positive); SCOR S.E. (IFS Rating: A+/Stable); and Partner Reinsurance Company Ltd (IFS
Rating: AA −/Stable).
COFACE SA
March 2014
11

Insurance
Figure 14
(%)
Factoring business/total revenues
Debt collection & services/total revenues
2009
7
18
2010
7
16
Source: Fitch
2011
8
8
2012
5
7
2013 Fitch ’s expectation
5 Fitch expects growth in other activities to remain at current levels, consistent with Coface‟s intention to
7 focus on its credit insurance activity.

Factoring

Debt collection and information services
In 2013, the factoring activity remained stable at 5% of total revenue. Factoring‟s revenue decreased by 21.7% in 2012 due mainly to the disposal of Coface Finans AS Denmark and the run-off of seven other factoring entities. Moreover, the Coface Finanz and Coface Factoring
Poland activities shrank following the 26% voluntary reduction in the volume of financing.
Fitch expects the factoring activity to remain stable over the next few years in line with Coface‟s strategy to focus on its credit insurance business.
In order to leverage group knowhow, Coface is active in the complementary businesses of financial information and the recovering of trade receivables. Revenue from t he group‟s services activity remained stable at 7% in 2013 on a comparable basis. Central Europe contributes the bulk of debt collection and information services.
COFACE SA
March 2014
12

Insurance
Complete Ratings List
Coface:
Long-Term Foreign-Currency IDR
„A+‟/Stable
IFS Rating „AA−‟/Stable
ShortTerm IFS Rating „F1+‟
COFACE SA (holding co):
Long-Term Foreign-Currency IDR
„A‟/Stable
Short-Term Foreign-
Currency IDR „F1‟
Coface North America Insurance
Company (CNAIC):
IFS Rating „AA−‟/Stable
Coface Finanz GmbH:
Long-Term Foreign-Currency IDR
„A+‟/Stable
COFACE SA
March 2014
Below is a summary of additional ratings considerations of a “technical” nature that are part of
Fitch‟s ratings criteria.
Coface is rated on a group approach, with its main subsidiaries being considered “Core”.
Therefore, the main subsidiaries‟ ratings have been aligned with those of Coface itself.
The Coface group ‟s ratings are based on an analysis of its own credit risk profile, taking into account its ownership by Natixis
– see in particular page 3 of this report.
Fitch regards France as having a
“Strong” regulatory environment, with restrictions on payments from operating companies to holding companies and with priority afforded to policyholder obligations.
Holding Company
Fitch rates COFACE SA, the ultimate parent holding company of the Coface group, at an „A‟
IDR, one notch below the IDR of its core insurance subsidiaries.
IFS Ratings
A “Good” baseline recovery assumption was applied to IFS Ratings, and standard notching was used based on the existence of policyholder priority for the operating companies. The IFS
Ratings of the operating companies therefore stand one notch higher than their actual or implied IDRs.
Debt
Not applicable.
Hybrids
Not applicable.
Coface ‟s Short-Term IFS Rating is „F1+‟, which is standard when the Long-Term IFS Rating is
„AA-„.
The short-term debt rating of the EUR500m commercial paper issued by COFACE S.A is „F1‟, which is standard when the Long-
Term IDR is „A+‟. The issue is entirely backed by five credit lines.
Not applicable.
None.
13

Insurance
COFACE SA
March 2014
The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.
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 WEB SITE AT WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA, AND
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