Standard & Poor's has raised the rating of Irish Life Assurance to A-, one notch above the sovereign rating.

S&P has also given a stable outlook for the rating, based on its expectations that Irish Life is likely to continue to have a strong competitive position in Ireland, while maintaining its very strong capital and earnings.

“We could lower the rating if we lowered ILA’s SACP. This could occur if our view of its competitive position weakened, demonstrated by a sustainable reduction in market share or by its new business internal rate of return falling materially below 11 per cent,” S&P said.

The ratings agency said it could raise the rating if the business risk profile improved.

Irish Life group chief executive Bill Kyle said the move was a positive development for the company.

“We are particularly encouraged that S&P has pointed to Irish Life’s very strong financial risk profile, capital and earnings and strong risk management controls while also noting that our liquidity is exceptional,” he said.