AM Best affirms Athene Group’s financial rating of A
AM Best has affirmed the financial strength rating (FSR) of A (Excellent) and the long-term issuer credit ratings (long-term ICRs) of a+ (Excellent) of the members of Athene Group, which is the consolidation of the organisation’s US operating companies, along with its affiliated reinsurance companies domiciled in Bermuda. It is focused on the pension group annuity, funding agreement, fixed indexed and fixed annuity market segments.
The ratings reflect Athene’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, favourable business profile and appropriate enterprise risk management.
“AM Best views Athene’s consolidated risk-adjusted capitalization as strongest, as measured by Best’s Capital Adequacy Ratio, and supported by favourable financial flexibility,” AM Best said. “Athene has demonstrated its ability to access capital markets and maintains additional access to capital and liquidity through a revolving credit facility, Federal Home Loan Bank borrowing capacity, and a shelf registration statement, as well as uncalled capital commitments from Athene Co-Invest Reinsurance Affiliates investors. The completed merger with Apollo Global Management is expected to increase Athene’s financial flexibility,” it added.
Financial leverage metrics have improved in the past year as capital growth has outstripped debt issuances, but Athene holds elevated allocations to more complex and less-liquid investments, which could be impacted materially under adverse market conditions, AM Best said.
“Athene has a track record of strong earnings driven by favourable earning spreads and operating profitability, despite the challenges related to the persistent low interest rate environment and high competitive pressures,” it added.
