S&P: Genworth Australia view to negative

S&P said it revised its outlook on Genworth Financial Mortgage Insurance Pty Ltd. (Genworth Australia) to negative from stable and affirmed its A+ ratings.

S&P said the outlook revision reflects its expectations of a possible weakening of Genworth Australia's competitive position, and subsequent operating performance, as a consequence of the continued decline in the insurer's market position.

Genworth Australia has lost two large customers over the past three years, with its most recent announcement relating to the loss of its second-largest customer, which has elected to not renew its contract (effective April 2017). This customer represented about 14% of its gross written premium in fiscal 2016 (ended Dec. 31).

As a result, S&P said it expects Genworth Australia's full-year 2017 gross written premium to contract further, which is below the previous expectation of modest premium growth.

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