AM Best Upgrades Credit Ratings of Athene Holding Ltd. and Its Subsidiaries
June 20 2024 - 4:05PM
Business Wire
AM Best has upgraded the Financial Strength Rating (FSR)
to A+ (Superior) from A (Excellent) and the Long-Term Issuer Credit
Rating (Long-Term ICR) to “aa-” (Superior) from “a+” (Excellent) of
the members of Athene Group (Athene). Athene is the consolidation
of the organization’s U.S. operating companies, along with its
affiliated reinsurance companies domiciled in Bermuda. In addition,
AM Best has upgraded the Long-Term ICR to “a-” (Excellent) from
“bbb+” (Good) of Athene Holding Ltd. (Delaware). Athene Holding
Ltd. operates as the holding company for the U.S. and Bermuda
operations. Concurrently, AM Best has upgraded the Long-Term Issue
Credit Ratings (Long-Term IRs) and the indicative Long-Term IRs of
Athene Holding Ltd. (Delaware). The outlook of these Credit Ratings
(ratings) has been revised to stable from positive. (See below for
a detailed listing of the companies and ratings).
The ratings reflect Athene’s balance sheet strength, which AM
Best assesses as very strong, as well as its strong operating
performance, favorable business profile and appropriate enterprise
risk management.
The rating upgrades reflect a continuing trend of Athene’s
improving balance sheet strength. AM Best views Athene’s
consolidated risk-adjusted capitalization as strongest, as measured
by Best’s Capital Adequacy Ratio (BCAR), supported by favorable
financial flexibility, including significant excess liquidity.
Athene has demonstrated its ability to access capital markets and
maintains additional access to capital and liquidity through a
liquidity facility, revolving credit facility, Federal Home Loan
Bank borrowing capacity and a shelf registration statement, as well
as uncalled capital commitments from Athene Co-Invest Reinsurance
Affiliates (ACRA) investors, which has been beneficial to Athene’s
financial position. The 2022 merger with Apollo Global Management,
Inc. is expected to have a longer-term positive impact on Athene’s
financial flexibility.
Financial leverage metrics support Athene’s current ratings. AM
Best notes that Athene holds elevated allocations to less-liquid
investments, which could be impacted materially under adverse
market conditions, though default in its investment portfolio has
been low to date.
Athene has a track record of consistently positive earnings
driven by favorable earning spreads and operating profitability,
despite the challenges related to competitive pressures.
Athene’s favorable business profile reflects continued
enhancements through additional distribution channels in its retail
markets, as well as expansion of its pension risk transfer (PRT)
business in the United States, its increased issuances of funding
agreements and wider use of its flow reinsurance channel in Japan
in recent years. During this time, Athene has demonstrated
restraint and pricing discipline. Furthermore, the ACRA structures,
and the recent PRT deals are expected to be accretive to earnings
and available capital.
The FSR has been upgraded to A+ (Superior) from A (Excellent)
and the Long-Term ICRs to “aa-” (Superior) from “a+” (Excellent),
with the outlooks revised to stable from positive for the following
members of Athene Group:
- Athene Annuity & Life Assurance Company
- Athene Annuity & Life Assurance Company of New York
- Athene Annuity and Life Company
- Athene Life Insurance Company of New York
- Athene Life Re Ltd.
- Athene Life Re International Ltd.
- Athene Co-Invest Reinsurance Affiliate International Ltd.
- Athene Co-Invest Reinsurance Affiliate 1A Ltd.
- Athene Co-Invest Reinsurance Affiliate 1B Ltd.
- Athene Annuity Re Ltd.
- Athene Co-Invest Reinsurance Affiliate 2A Ltd.
- Athene Co-Invest Reinsurance Affiliate 2B Ltd.
The following Long-Term IRs have been upgraded with the outlooks
revised to stable from positive:
Athene Holding Ltd. — -- to “a-” (Excellent) from “bbb+” (Good)
on $500 million 3.45% senior unsecured notes, due 2052 -- to “a-”
(Excellent) from “bbb+” (Good) on $500 million 3.95% senior
unsecured notes, due 2051 -- to “a-” (Excellent) from “bbb+” (Good)
on $1.0 billion 4.125% senior unsecured notes, due 2028 -- to “a-”
(Excellent) from “bbb+” (Good) on $500 million 6.15% senior
unsecured notes, due 2030 -- to “a-” (Excellent) from “bbb+” (Good)
on $500 million 3.5% senior unsecured notes, due 2031 -- to “bbb”
(Good) from “bbb-” (Good) on $750 million 6.35%, perpetual,
non-cumulative preferred stock, Series A -- to “bbb” (Good) from
“bbb-” (Good) on $300 million 5.625%, perpetual, non-cumulative
preferred stock, Series B -- to “bbb” (Good) from “bbb-” (Good) on
$600 million 6.375%, preferred stock -- to “bbb” (Good) from “bbb-”
(Good) on $575 million 4.875%, preferred stock
The following indicative Long-Term IRs have been upgraded with
the outlooks revised to stable from positive:
Athene Holding Ltd. — -- to “a-” (Excellent) from “bbb+” (Good)
on senior unsecured debt -- to “bbb+” (Good) from “bbb” (Good) on
subordinated debt -- to “bbb” (Good) from “bbb-” (Good) on junior
subordinated debt -- to “bbb” (Good) from “bbb-” (Good) on
preferred stock
This press release relates to Credit Ratings that have been
published on AM Best’s website. For all rating information relating
to the release and pertinent disclosures, including details of the
office responsible for issuing each of the individual ratings
referenced in this release, please see AM Best’s Recent
Rating Activity web page. For additional information
regarding the use and limitations of Credit Rating opinions, please
view Guide to Best's Credit Ratings. For information
on the proper use of Best’s Credit Ratings, Best’s Performance
Assessments, Best’s Preliminary Credit Assessments and AM Best
press releases, please view Guide to Proper Use of Best’s
Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London,
Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more
information, visit www.ambest.com.
Copyright © 2024 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240620147520/en/
Louis Silvers Senior Financial Analyst +1 908 882
2316 louis.silvers@ambest.com
Michael Porcelli Senior Director +1 908 882
2250 michael.porcelli@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com