This announcement follows our annual day-long meeting between Royal London and Standard & Poor's which was held in June at our offices in Gracechurch Street, London.
This is a particularly pleasing result for Royal London following the decision by Moody's to change the outlook on selected UK life insurers (including Royal London) following the vote to leave the European Union in June.
Royal London's credit ratings provide an independent assessment of:
They also promote confidence in Royal London amongst key internal and external stakeholders.
An 'A' from Standard & Poor's is a good rating, and means Royal London has a' strong capacity to meet its financial commitments'. A stable outlook means that Standard & Poor's do not expect to raise our rating in the next two years.
Standard & Poor's said:
Royal London has sustained its strong position and market share in the UK life market throughout the recent reforms in the industry. It has adapted its business to the new life and pensions environment while maintaining strong service levels and brand reputation. In addition, Royal London benefits from a strong and long-standing relationship with intermediaries, helped by its focus on the midsize market.
Royal London stands out as one of the few major mutual insurance companies still operating in the UK. The mutual's unique brand reputation provides it with the potential to stand out from its peers and supports our assessment of a strong competition position.
We continue to view costs as a key aspect of our assessment of Royal London's competitive position. Significant growth in funds under management (both organically and inorganically) has recently eased this pressure compared with previous years, as seen in stronger margins in the pension business. However, the group is still behind the biggest players in the UK. market.
We expect Royal London to continue monitoring costs to ensure it remains competitive. We believe that the vote in favour of Brexit will not materially affect Royal London's competitive position because the majority of its business is generated from within the UK.