AM Best Assigns Issue Credit Rating to Prudential Financial, Inc.’s New Junior Subordinated Notes
March 13 2024 - 11:58AM
Business Wire
AM Best has assigned a Long-Term Issue Credit Rating of
“bbb” (Good) to the $1 billion, 6.5% fixed to fixed reset rate
junior subordinated notes, due March 15, 2054, of Prudential
Financial, Inc. (Prudential) (Newark, NJ) [NYSE: PRU]. The outlook
assigned to this Credit Rating (rating) is stable. All other
ratings of Prudential and its subsidiaries remain unchanged.
The proceeds from this debt issuance are expected to be used for
general corporate purposes, which may include repurchasing all of
Prudential’s $1.0 billion, 5.375% fixed to floating rate junior
subordinated notes due in 2045 and callable in 2025. The impact on
Prudential’s debt leverage is expected to elevate slightly higher
over the medium term as a higher leverage ratio will be realized
prior to the note redemption before decreasing to the mid-to-high
20% range, and the interest coverage with this debt issue is
expected to remain favorable. Prudential’s liquidity position is
strong, with the parent company holding highly liquid assets of
$4.1 billion at year-end 2023. The company’s full-year 2023 pre-tax
adjusted operating income was $5.5 billion; however, on a net
basis, the company reported gains of $2.5 billion. In its most
recent disclosure, a primary driver of full-year 2023 results, is
derived by both its U.S. business and international business
segments, as well as Prudential’s global asset management business
(PGIM,), which added approximately $700 million of fee based
pre-tax earnings.
This press release relates to Credit Ratings that have been
published on AM 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 AM Best’s Recent
Rating Activity web page. For additional information
regarding the use and limitations of Credit Rating opinions,
please view Guide to Best's Credit Ratings. For
information on the proper use of Best’s Credit Ratings, Best’s
Performance Assessments, Best’s Preliminary Credit Assessments and
AM Best press releases, please view Guide to Proper Use of
Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
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