S&P: Sanlam Life notes zaAA+

S&P said it assigned zaAA+ South Africa national scale issue ratings to Sanlam Life Insurance Ltd.’s unsecured subordinated callable notes.

The proceeds will be used for general corporate purposes.

Under the agency’s methodology, S&P said it applies a one-notch downward adjustment on the global scale for deferability and another one on the national scale for subordination.

That is why the agency assigned a rating on the proposed notes that is one-notch below the zaAAA South Africa national scale rating on the issuer, Sanlam.

Sanlam can call the note on the specified maturity date and also has the right to redeem the note on a tax or regulatory event, S&P said.

The agency also said it expects to classify the note as having minimal equity content under the hybrid criteria as the maturity is less than 20 years.

Including this new debt, Sanlam’s financial leverage is expected to remain neutral rating factors, S&P said.

The company has a satisfactory business risk profile, strong competitive position, moderately strong capital and earnings and adequate financial flexibility, the agency said.

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