AM Best Comments on Credit Ratings of Athene Group Following Fixed Annuity Reinsurance Agreement

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has commented that the Credit Ratings (ratings) and outlooks of the members of Athene Group (Athene) remain unchanged following the recent announcement of its fixed annuity reinsurance agreement, which is effective June 1, 2020.

Athene, which is focused on the fixed indexed and fixed annuity market segments, is the consolidation of the organization’s U.S. operating companies, along with its affiliated reinsurance companies domiciled in Bermuda.

The agreement adds $27 billion of fixed deferred and fixed indexed annuity statutory reserves from Jackson National Life Insurance Company and includes a $1.25 billion ceding commission, with a net $29 billion in assets transferred to Athene. AM Best views this deal as potentially accretive to Athene’s business profile by expanding and increasing the diversification of earnings sources, dependent on the execution and integration of the block. As part of the transaction, and expecting to close in July 2020, Athene will invest $500 million in Prudential plc’s U.S. holding company in exchange for an 11.1% economic interest (9.9% voting interest) in Prudential plc’s U.S. business.

The outlooks of Athene Holding Ltd.’s Long-Term Issuer Credit Rating (Long-Term ICR) of “bbb”, its existing Long-Term IRs and the Long-Term ICRs of its operating insurance subsidiaries were affirmed with a positive outlook on May 22, 2020 (see related press release), and remain unchanged.

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