A.M. Best has revised the outlook to positive from stable and affirmed the issuer credit ratings (ICR) of "a" of the key life insurance entities of Voya Financial. At the same time, A.M. Best has affirmed with a stable outlook the financial strength rating (FSR) of A (Excellent) of the life subsidiaries of Voya.
Concurrently, A.M. Best has revised the outlook to positive from stable and affirmed the ICR of "bbb" of Voya as well as the ratings on Voya's outstanding debt.
The rating actions reflect the favorable trends in Voya's operating earnings, sound risk-adjusted capitalisation and renewed focus on its retirement and employee benefits businesses.
In addition, A.M. Best has acknowledged Voya's success in executing the initial public offering in May 2013 and subsequent public offerings that have reduced ING Group's ownership of Voya to approximately 43 percent.
While some execution risks remain surrounding the completion of the process of becoming independent and rebranding to Voya from ING US, A.M. Best has stated that this risk has somewhat diminished as demonstrated by recent successful debt issuances totaling approximately $3 billion and favourable demand for its public shares.
A.M. Best have stated that future positive rating actions for Voya could come from sustained favourable operating results across its core business lines without material drag from the legacy variable annuity business as well as maintenance of strong levels of risk-adjusted capital
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Factors that could lead to future negative rating actions include significant operating losses or reserve increases in the variable annuity block, notable spread compression in interest-sensitive lines and/or a material reduction in risk-adjusted capitalisation.
