OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has assigned a Long-Term Issue Credit Rating of “bbb-” to the $350 million 6.75% non-cumulative preferred stock, Series B recently issued by Brighthouse Financial, Inc. (Brighthouse) (headquartered in Charlotte, NC) [NASDAQ: BHF]. The outlook assigned to this Credit Rating (rating) is stable.
This transaction follows a senior unsecured notes offering of $500 million that Brighthouse executed in the prior week. As expected, the company used those net proceeds to repay a portion of its term loan, bringing that term loan down from $1 billion to $504 million. Brighthouse will use the net proceeds of this preferred issuance to further repay a portion of the term loan balance. The impact of the transaction on leverage is expected to be slightly positive after the company pays down part of its term loan. Following the application of the net proceeds from this preferred issuance, Brighthouse is expected to have $165 million outstanding under its term loan. Interest coverage decreased on a trailing 12-month basis from prior periods, as major hedge gains in first-quarter 2020 reduced earnings before interest and taxes (EBIT).
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