Moody’s applies Baa3 to Brighthouse

Moody's Investors Service said it assigned a Baa3 long-term issuer rating to Brighthouse Financial, Inc. and Brighthouse Holdings, LLC with a stable outlook.

The issuer ratings are based on an expectation that when separated from MetLife, Inc. (senior debt A3 stable), Brighthouse Financial will be the owner of Brighthouse Holdings, which will in turn be the direct owner of several insurance operating entities, including MetLife Insurance Co. USA (A3 insurance financial strength, stable) and New England Life Insurance Co. (A3 insurance financial strength, stable).

The Baa3 issuer ratings are three notches lower than the A3 insurance financial strength ratings of its operating companies, MetLife Insurance and New England Life.

For Brighthouse Financial, Brighthouse's ultimate future holding company, this reflects Moody's typical notching for an insurance holding company relative to its insurance operating subsidiaries, the agency said.

For Brighthouse Holdings, which will function as the intermediate holding company that will directly own the insurance operating companies, it reflects Moody's expectation that debt or other securities issuances from it, which would structurally subordinate Brighthouse Financial debtholders, will be de minimus.

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