This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

A.M. Best Assigns Debt Rating To Ameriprise Financial, Inc.’s New Senior Notes

A.M. Best Co. has assigned a debt rating of “a-” to the $600 million 4.00% 10-year unsecured senior notes, due October 15, 2023 issued by Ameriprise Financial, Inc. (Ameriprise Financial) (headquartered in Minneapolis, MN) [NYSE:AMP]. The outlook assigned is stable. All other ratings of Ameriprise Financial and its subsidiaries are unchanged.

Proceeds from the issuance are expected to be used for general corporate purposes, which may include the repayment of all or part of the 5.65% senior notes, due 2015 ($700 million principal amount outstanding) and/or the 7.75% senior notes, due 2039 ($200 million principal amount outstanding). With this issuance and warehousing of the net proceeds, A.M. Best calculates Ameriprise Financial’s debt-to-capital ratio to initially rise to approximately 24%, which remains in line with the company’s rating guidelines. The organization’s financial leverage has historically remained at the lower end of the rating range and is generally conservative compared to its industry peers. When and if the proceeds are utilized to retire a like amount of existing debt, financial leverage is expected to be reduced to approximately 21%, while interest coverage is expected to remain very strong. Although there may be a small increase in Ameriprise Financial’s financial leverage ratio upon issuance, the pro forma impact on financial leverage, along with interest expense coverage, is expected to remain well within A.M. Best’s expectations for its assigned rating.

Ameriprise Financial continues to benefit from its strong fee-based businesses, growth in client and advisory activity and increased sales and deposits in the protection and variable annuity space. Somewhat offsetting these positive results are the company’s slightly higher exposure to interest rates and equity markets, which continues to impact its earnings. Ameriprise Financial may continue to experience net outflows in its annuity and asset management businesses due to the ongoing volatility in the financial markets. However, sales of managed volatility funds have continued to increase in recent months.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG

Markets

DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs