Fitch rates Momentum Group notes AA-(zaf)

Fitch Ratings said it assigned an AA-(zaf) rating to South Africa-based Momentum Group Ltd.'s ZAR1 billion issue of unsecured subordinated callable notes due 2020, which have an initial coupon rate of 8.5% that reverts to a floating rate from the first call date in September 2015. At the first call date, a step-up of 80% of the initial credit spread would apply.

Momentum's ratings reflect its strong business position in South Africa, solid capital position, robust new business profit margins and very strong operating performance, the agency said.

Partially offsetting these factors is the company's lack of diversification outside of South Africa and the challenge to defend its business position, amid a very competitive South African life insurance market.

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