APRIL 08, 2015 02:01 PM (EDT)
A.M. Best Comments on the Ratings of MTL Insurance Company Following Merger Announcement
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FOR IMMEDIATE RELEASE
OLDWICK - APRIL 08, 2015 02:01 PM (EDT)
A.M. Best has commented that the financial strength rating of A- (Excellent) and the issuer credit rating of "a-" of MTL Insurance Company (Oak Brook, IL) (MTL) remain unchanged following the recent merger announcement between Mutual Trust Holding Company (MTHC), MTL's ultimate parent, and Pan-American Life Mutual Holding Company (PALMHC), the ultimate parent of Pan-American Life Insurance Company (PALIC). Additionally, the debt rating of "bbb" for MTL's $30 million 6.25% surplus note due March 2028 remains unchanged.
As a result of the merger, MTHC and MTL Holdings Inc., MTL's intermediate holding company, will be merged into PALMHC and Pan-American Life Insurance Group, Inc. (PALIG), PALIC's intermediate holding intermediate holding company, respectively. Additionally the $10.9 million of trust preferred securities held at MTL Holdings Inc. will be assumed by PALIG.
A.M. Best expects that MTL will operate as a stand-alone entity, providing PALIG with geographic diversification and potential distribution relationships to expand into the U.S. Going forward, A.M. Best's will assess any changes to the business strategy for MTL and its implications for revenue and earnings growth over time, as well as any potential synergies with its new parent.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
This press release relates to rating(s) 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 visit A.M. Best's Ratings & Criteria Center.
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