AM Best Withdraws Ratings for American Equity Investment Life Holding

AM Best Withdraws Long-Term Issue Credit Ratings

In an important development, AM Best has decided to withdraw its Long-Term Issue Credit Ratings for American Equity Investment Life Holding Company (AEL). This decision encompasses the ratings assigned to multiple financial instruments, marking a significant moment for the company.

Details of the Withdrawn Ratings

Specifically, AM Best has withdrawn the ratings on a range of notes including $500 million in 5% senior unsecured notes, set to mature in 2027, alongside $300 million in 6.625% perpetual, non-cumulative preferred stock and $400 million in 5.95% perpetual, non-cumulative preferred stock. The company's decision to step back from participating in AM Best's rating evaluation process prompted this withdrawal.

Review Status Before Withdrawal

At the time of the withdrawal, these Long-Term Issue Ratings were already under review, indicating developing implications for AEL. This under-review status was maintained prior to AM Best's final update.

Impact on Future Ratings

With the withdrawal of the ratings by AM Best, AEL will no longer have these Long-Term Issue Credit Ratings published on AM Best’s platform. This event highlights the company's current positioning in the financial market.

About AM Best

AM Best is a renowned global credit rating agency that specializes in providing insight and analytics, particularly focused on the insurance sector. With its headquarters in the United States, the agency operates in over 100 countries, maintaining regional offices strategically positioned in major cities such as London, Amsterdam, Dubai, Hong Kong, Singapore, and Mexico City. As a respected authority in the field, AM Best continues to influence the financial landscape significantly.

Understanding Credit Ratings

Credit ratings serve as a crucial benchmark for stakeholders in the financial market, influencing investment decisions and perceptions of risk. The ratings help investors gauge the creditworthiness of bonds and other financial products. In this case, the withdrawal of ratings for AEL signifies a notable shift in how the company is viewed in terms of credit risk and reliability.

Why Ratings Matter

The reputation and operational efficiency of an entity like AEL can be significantly impacted by credit ratings. They provide insights into the financial health and operational stability of companies. Therefore, the withdrawal from AM Best's rating process may prompt stakeholders to reassess their positions regarding AEL.

Conclusion

This recent development regarding American Equity Investment Life Holding Company and its ratings withdrawal marks an important update for investors and industry professionals. Moving forward, stakeholders will be watching closely to see how this impacts AEL's business operations and financial strategies.

Frequently Asked Questions

What does AM Best do?

AM Best is a global credit rating agency specializing in the insurance industry, providing ratings, news, and analytics.

Why were the ratings withdrawn for AEL?

The ratings were withdrawn as AEL requested not to participate further in AM Best’s rating evaluation process.

What are Long-Term Issue Credit Ratings?

Long-Term Issue Credit Ratings assess the creditworthiness of an issuer's long-term debt obligations, indicating their ability to repay over time.

What impact does the withdrawal have?

The withdrawal signals potential changes in how investors may perceive AEL's creditworthiness, possibly influencing investment decisions.

How does AM Best determine ratings?

AM Best evaluates credit ratings based on various factors, including financial performance, market conditions, and operational effectiveness.

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