Moody's gives NN Group bonds Baa3

Moody's Investors Service said it assigned a Baa3(hyb) rating with a negative outlook to the dated subordinated bonds to be issued by NN Group NV.

The agency also assigned a Baa2 issuer rating with a negative outlook to NN Group, the holding company for European and Japanese insurance operations of the ING group and currently owned at 100% by ING Groep NV (A3 negative).

ING has committed, as part of a restructuring plan agreed with the European Commission, to sell more than 50% of these operations by year-end 2015 and 100% by year-end 2016. ING has announced its intention to divest these operations through an initial public offering of NN Group.

The Baa3(hyb) rating of the bonds is based on the expectation that there will be no material difference between current and final documentation.

Moody's said the Baa3(hyb) rating is one notch below NN Group's issuer rating, in line with the standard notching practices for debts issued by insurance holding companies, and reflects (a) the subordination of the bonds; (b) the optional and mandatory weak coupon deferral mechanisms; and (c) the cumulative nature of deferred coupons, in case of deferral.

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