Best’s News & Research Service - December 16, 2016 02:33 PM (EST)
A.M. Best Assigns Issue Credit Rating to The Empire Life Insurance Company’s New Subordinated Debentures
- December 16, 2016 02:33 PM (EST)
Oldwick //BestWire// - A.M. Best has assigned a Long-Term Issue Credit Rating of “bbb+” to the recently issued CAD 200 million subordinated debentures with an initial rate of 3.383% maturing on Dec. 16, 2026, of The Empire Life Insurance Company (Empire Life) (Kingston, Ontario, Canada). The outlook assigned to the Credit Rating (rating) is stable, which is consistent with the existing rating outlooks of Empire Life.
Empire Life intends to use the net proceeds from the sale for general corporate purposes and to support regulatory capital. The debt is structured with a fixed initial five-year rate of 3.383%, followed by a five-year floating rate equal to the three-month Bankers’ Acceptance Rate plus 1.95%.
The rating reflects Empire Life’s consistent operational profitability and ability to service its policyholder and debt obligations. Empire Life has a strong risk-adjusted capital position and a competitive market position. Empire Life is among the 10 largest life insurance companies in Canada (based on general and segregated fund assets). Empire Life markets a broad range of life insurance and investment products, employee benefit plans and financial services to individuals, professionals and the small- to- medium group market through multiple distribution channels. Additionally, A.M. Best will continue to monitor the company, which has been challenged due to sustained low interest rates and recent equity market volatility given its large segregated fund block of business.
This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
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