AM Best Affirms Credit Ratings of Principal Financial Group, Inc. and Its Subsidiaries
27 Marzo 2024 - 3:29PM
Business Wire
AM Best has affirmed the Financial Strength Rating of A+
(Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICRs)
of “aa” (Superior) of Principal Life Insurance Company and
Principal National Life Insurance Company. Both are life insurance
operating companies of Principal Financial Group, Inc. (PFG)
[NASDAQ: PFG] and collectively referred to as Principal.
Concurrently, AM Best has affirmed the Long-Term ICRs of “a”
(Excellent) of Principal Financial Services, Inc. and PFG, as well
as the group’s Long-Term Issue Credit Ratings (Long-Term IRs). In
addition, AM Best also has affirmed the group’s Short-Term Issue
Credit Rating (Short-Term IR). The outlook of these Credit Ratings
(ratings) is stable. (Please see below for a detailed listing of
the Long- and Short-Term IRs.) All companies are headquartered in
Des Moines, IA.
The ratings reflect Principal’s balance sheet strength, which AM
Best assesses as very strong, as well as its strong operating
performance, favorable business profile and very strong enterprise
risk management.
AM Best views Principal’s risk-adjusted capitalization as
strong, as measured by Best’s Capital Adequacy Ratio (BCAR),
although capital growth has been limited by dividends to the parent
company. The company lowered its product risk with reinsurance in
2022, ceding its in-force retail fixed annuity and universal life
insurance with secondary guarantee (ULSG) blocks. The balance sheet
strength assessment also benefits from historically favorable
financial flexibility, liquidity profiles and significant excess
capital and access to capital markets at the holding company level.
AM Best’s favorable view of the company’s capital is somewhat
offset by Principal’s higher allocations to commercial mortgages in
comparison with the group’s peers and usage of its captive
reinsurers.
The company has consistently reported favorable profitability
metrics, benefiting from its diverse lines of business,
distribution channels and leading market positions. An increasing
presence internationally provides additional earnings diversity.
However, AM Best notes that political and macroeconomic risks in
Principal’s key international markets could have negative effects
on the holding company going forward.
Principal has demonstrated strong risk management capabilities
through continued enhancements to its risk modeling and
stress-testing capabilities to support its overall business
strategy, which have driven recent major business decisions.
The following Long-Term IRs have been affirmed with a stable
outlook:
Principal Financial Group, Inc. – — “a” (Excellent) on $400
million 3.40% senior unsecured notes, due 2025 — “a” (Excellent) on
$350 million 3.1% senior unsecured notes, due 2026 — “a”
(Excellent) on $500 million 3.70% senior unsecured notes, due 2029
— “a” (Excellent) on $600 million 2.125% senior secured notes, due
2030 — “a” (Excellent) on $505.6 million 6.05% senior unsecured
notes, due 2036 — “a” (Excellent) on $400 million 5.375% senior
unsecured notes, due 2033 — “a” (Excellent) on $300 million 4.625%
senior unsecured notes, due 2042 — “a” (Excellent) on $300 million
4.35% senior unsecured notes, due 2043 — “a” (Excellent) on $300
million 4.30% senior unsecured notes, due 2046 — “a” (Excellent) on
$300 million 5.5% senior unsecured notes, due 2053
Principal Life Global Funding I— “aa” (Superior) on program
rating — “aa” (Superior) on all outstanding notes issued under the
program
Principal Life Global Funding II— “aa” (Superior) on program
rating — “aa” (Superior) on all outstanding notes issued under the
program
Principal Financial Global Funding, LLC— “aa” (Superior) on
program rating — “aa” (Superior) on all outstanding notes issued
under the program
Principal Financial Global Funding II LLC— “aa” (Superior) on
program rating
Principal Life Income Funding Trusts— “aa” (Superior) on program
rating
The following Short-Term IR has been affirmed: Principal Life
Insurance Company— — AMB-1+ (Strongest) commercial paper rating
The following indicative Long-Term IRs on securities available
under universal shelf registration have been affirmed with a stable
outlook:
Principal Financial Group, Inc.— — “a” (Excellent) on senior
unsecured debt — “a-” (Excellent) on subordinated debt — “bbb+”
(Good) on preferred stock
Principal Capital I, II and III— — “aa” (Superior) on preferred
securities
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.
Copyright © 2024 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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Louis Silvers Senior Financial Analyst +1 908
882 2316 louis.silvers@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Jacqalene Lentz Director +1 908 882 2011
jacqalene.lentz@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com
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