OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has assigned a Long-Term Issue Credit Rating of “bbb” to the $500 million of 3.90% senior unsecured notes, due May 2029, recently announced by CNA Financial Corporation (CNAF) (headquartered in Chicago, IL) [NYSE:CNA]. The outlook assigned to the Credit Rating (rating) is positive.
The proceeds from the sale of the notes will be used to repurchase, redeem, repay or otherwise retire the $500 million outstanding aggregate principal balance of CNAF’s 5.875% senior unsecured notes due Aug. 15, 2020. While CNAF’s financial leverage will increase modestly and temporarily immediately following the issuance, it will remain well within AM Best’s guidelines to support CNAF’s current ratings. Once the refinancing transactions are complete, AM Best anticipates that CNAF’s adjusted and unadjusted debt-to-total capital ratios will return to levels that approximate current levels and that coverage ratios will improve modestly due to the lower coupon on the new debt.
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