OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has downgraded the Financial Strength Rating (FSR) to A (Excellent) from A+ (Superior) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “a+” from “aa-” of AXA Equitable Life Insurance Company (AXA Equitable) (New York, NY). Concurrently, A.M. Best has downgraded the Long-Term ICR to “bbb+” from “a-” and the Long-Term Issue Credit Rating (Long-Term IR) and the Short-Term Issue Credit Rating (Short-Term IR) of AXA Financial, Inc. (AXA Financial) (headquartered in New York, NY). The outlook of these Credit Ratings (ratings) is stable.
These rating actions follow AXA S.A.’s (AXA) announced intentions to list a minority share of its U.S. life operations in the first half of 2018. AXA has indicated that proceeds from the initial public offering will likely be reinvested in the group’s priority segments or returned to shareholders.
In light of AXA’s public announcement, A.M. Best no longer considers the U.S. life operations to be as strategically important to the group, and as such, these operations no longer qualify for the same level of rating enhancement currently awarded under A.M. Best’s rating criteria. While the stand alone credit profiles of AXA Financial and its U.S. life operating company subsidiaries are not immediately impacted by AXA’s announcement, the rating downgrades are a direct result of a reduction in the level of rating enhancement afforded to these companies, reflecting A.M. Best’s view that the U.S. life operations will likely realize a future decline in both implicit and explicit support from AXA. A.M. Best will continue to monitor the importance of the U.S. life operations as part of the AXA group’s strategy. Any further reduction in the level of perceived support from AXA to these operations or change in its controlling interest may result in another negative rating action.
Additionally, the Long-Term ICR has been downgraded to “a” from “a+” and the FSR of A (Excellent) has been affirmed with a stable outlook for MONY Life Insurance Company of America (Phoenix, AZ), another subsidiary of AXA Financial.
The FSR has been downgraded to A- (Excellent) from A (Excellent) and the Long-Term ICR to “a-” from “a” with a stable outlook for AXA Equitable Life and Annuity Company (Denver, CO).
The FSR of A (Excellent) and the Long-Term ICR of “a” have been affirmed with a stable outlook for U.S. Financial Life Insurance Company (Cincinnati, OH).
The FSR of has been downgraded to B+ (Good) from B++ (Good) and the Long-Term ICR has been downgraded to “bbb-” from “bbb” with a stable outlook for AXA Corporate Solutions Life Reinsurance (Delaware).
The following Long-Term IR has been downgraded:
AXA Financial, Inc.—
-- To “bbb+” from “a-” on $350 million 7% senior unsecured debentures, due 2028
The following Short-Term IR has been downgraded:
AXA Financial, Inc.—
-- To “AMB-2” from “AMB-1” on its commercial paper program
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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