A.M. Best Assigns Rating to Subordinated Notes Issued by Talanx Finanz (Luxembourg) S.A and Guaranteed by Talanx AG

LONDON--(BUSINESS WIRE)--

A.M. Best Europe – Rating Services Limited has assigned a debt rating of “bbb” to the EUR 500 million subordinated fixed to floating rate notes due 2042 issued by Talanx Finanz (Luxembourg) S.A (Luxembourg) and irrevocably guaranteed on a subordinated basis by Talanx AG (Germany), which is the intermediate management holding company for all HDI Haftpflichtverband der Deutschen Industrie V.a.G. (HDI V.a.G.) (Germany) companies (collectively known as the Talanx Group). The assigned outlook is stable.

A.M. Best expects the net proceeds from the offering to be used to support the Talanx Group's ongoing organic growth, further expansion into emerging markets and/or retiring outstanding hybrid debt. The subordinated fixed to floating rate notes will pay a fixed annual coupon until the call date, 10 years after the issuance, when the interest rate will convert to a floating rate based on a three-month Euro Interbank Offered Rate, plus a margin. Financial leverage and interest coverage ratios are expected to remain within A.M. Best's tolerance levels.

Concurrently, A.M. Best has withdrawn the debt rating of “bbb+” on EUR 250 million subordinated fixed to floating rate notes due 2024 issued by the former Gerling-Konzern Allgemeine Versicherung AG and assigned the above debt rating to HDI-Gerling Industrie Versicherung AG, which is in line with the legal entity status of the debt.

The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Key criteria utilised include “Insurance Holding Company and Debt Ratings”. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

In accordance with Regulation (EC) No. 1060/2009, the following is a link to required disclosures: A.M. Best Europe - Rating Services Limited Supplementary Disclosure.

A.M. Best Europe – Rating Services Limited is a subsidiary of A.M. Best Company. Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.