AM Best Places Credit Ratings of BNZ Life Insurance Limited Under Review With Negative Implications

SINGAPORE--(BUSINESS WIRE)--AM Best has placed under review with negative implications the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” of BNZ Life Insurance Limited (BNZ Life) (New Zealand).

These Credit Rating (rating) actions follow the announcement on 16 December 2020, that National Australia Bank Limited, BNZ Life’s ultimate parent, has entered into an agreement to sell its New Zealand life insurance business, including BNZ Life, to Partners Life Limited (Partners Life). The transaction also includes the establishment of an exclusive 10-year agreement for the referral of Bank of New Zealand customers with life insurance needs to Partners Life. The total transaction consideration is NZD 290 million (USD 208 million). The transaction, which is subject to customary closing conditions, including regulatory and other approvals, is expected to be completed in the second half of 2021.

The ratings have been placed under review with negative implications, as AM Best needs to assess the impact of the planned acquisition on BNZ Life’s credit fundamentals, including any potential rating drag that could arise from its change in ownership. In addition, AM Best will need to consider the planned integration of BNZ Life within the Partners Life group, any expected changes in strategy and any implicit or explicit support to be provided by the new parent.

The ratings will remain under review pending completion of the transaction, and until AM Best can fully assess the post-acquisition credit rating fundamentals of BNZ Life.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

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