Moody's rates TIAA notes Baa3

Moody's Investors Service said it assigned Baa3 ratings to $1 billion of 2.95% senior notes due 2019 and $1 billion of 4.125% senior notes due 2024 recently issued by TIAA Asset Management Finance Co., LLC, a new wholly owned subsidiary holding company under Teachers Insurance & Annuity Association of America that owns Nuveen Investments, Inc. The rating is on review for upgrade.

Proceeds will be used to fund the redemption of Nuveen's outstanding senior notes and to repay a $328 million intercompany loan from TIAA.

The agency said TIAA Asset Management's Baa3 rating is principally driven by Nuveen's market-leading position in the high-margin, sticky closed-end fund business, its well-diversified AUM mix and its strong retail distribution capabilities.

In Moody’s opinion, these strengths are somewhat offset by the company's nascent international presence, high financial leverage and profitability levels that are weaker than similarly rated peers.

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