AM Best Revises Issuer Credit Rating Outlook to Positive for Athene Holding Ltd. and Its Subsidiaries

OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has revised the outlooks to positive from stable for the
Long-Term Issuer Credit Ratings (Long-Term ICR) and affirmed the
Financial Strength Rating of A (Excellent) and the Long-Term ICRs of “a”
of the members of Athene Group (Athene). The outlook of the FSR
remains stable. 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 Athene Life Re Ltd. (Bermuda), its
affiliated reinsurance company. Additionally, AM Best has revised the
outlooks to positive from stable and affirmed the Long-Term ICR of
“bbb”, the existing Long-Term Issue Credit Rating (Long-Term IR) and the
indicative Long-Term IRs of Athene Holding Ltd. (AHL) (Bermuda). AHL
operates as the holding company for the U.S. and Bermuda operations.
(See below for a detailed listing of Athene’s rated members and AHL’s
Long-Term IRs.)

The ratings of Athene reflect its balance sheet strength, which AM Best
categorizes as very strong, as well as its strong operating performance,
neutral business profile and appropriate enterprise risk management

The positive outlooks reflect a consistently improving business profile,
which AM Best currently characterizes as neutral. AM Best also notes
Athene’s solid risk-adjusted capitalization levels, as measured by
Best’s Capital Adequacy Ratio (BCAR), which are at the strongest level.
This is supported by relatively low financial leverage at the holding
company and solid liquidity. Athene also recently announced its new
Athene Co-Invest Reinsurance Affiliate (ACRA), which will be a vehicle
to raise funds for on-demand third party equity capital, and will work
like a sidecar for Athene. Partially offsetting these strengths is the
company’s investment portfolio, which includes structured securities and
alternative assets and is viewed as more aggressive compared with
traditional life insurance companies.

The company’s strong trend of earnings and organic capital growth has
enabled AHL and its operating companies to strengthen their balance
sheets while providing sufficient capital support for growth. Athene has
demonstrated a consistent trend of strong profitability and sales
growth. This includes recent pension risk transfer growth, solid fixed
indexed annuity sales, and continued block reinsurance transactions,
including the recent agreement with Lincoln Financial Group.

Athene maintains its position among the leaders in the fixed indexed
annuity market. AM Best also notes the challenges the company faces in
managing risks associated with its large retail distribution platform
and continued rapid growth. Also noted are the pressures associated with
managing assets in support of spread-based liabilities, given the
extended low interest rate environment.

The FSR of A (Excellent) has been affirmed with a stable outlook and the
Long-Term ICRs at “a” have been affirmed with the outlooks revised to
positive from stable for the following members of Athene Group:

  • Athene Annuity & Life Assurance Company
  • Athene Annuity & Life Assurance Company of New York
  • Athene Annuity and Life Company
  • Athene Life Insurance Company of New York
  • Athene Life Re Ltd.

The following Long-Term IR has been affirmed with the outlook revised to
positive from stable:

Athene Holding Ltd. —
–“bbb” on $1.0 billion 4.125% senior
unsecured notes, due 2028

The following indicative Long-Term IRs have been affirmed with the
outlook revised to positive from stable:

Athene Holding Ltd.
— “bbb” on senior unsecured debt

“bbb-” on subordinated debt
— “bb+” on junior subordinated debt

“bb+” on preferred stock

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
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best’s Credit Ratings
. For information on the proper media
use of Best’s Credit Ratings and AM Best press releases, please view
for Media – Proper Use of Best’s Credit Ratings and AM Best Rating
Action Press Releases

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