(CercleFinance.com) – Moody’s Investors Service announced on Thursday that it had placed AXA’s rating under review with a view to a possible upgrade following the group’s announcement of a project to transform its holding company into an internal reinsurer.
AXA expressed this morning its intention to transform AXA SA, the group’s holding company, into a reinsurer approved by the regulator, an operation which would lead it to absorb the current internal reinsurance captive AXA Global Re as part of a merger process.
Under the terms of the plan, AXA SA would also be responsible for reinsuring part of the group’s European non-life insurance entities, through quota-share reinsurance treaties.
‘This would diversify the cash flow of the holding company through additional reinsurance premiums, in addition to the existing dividends paid by the subsidiaries,’ explains Moody’s.
For the financial rating agency, this is a ‘positive’ element for the risk profile of the holding company.
Moody’s has an ‘A2’ rating on the group’s senior unsecured debt and an ‘A3’ rating on its subordinated debt.
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