TEXT-Fitch rates AXA's EUR1bn dated subordinated notes 'BBB'

Fri Jan 25, 2013 4:38am EST

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(The following statement was released by the rating agency)

Jan 25 - Fitch Ratings has assigned AXA S.A.'s EUR1bn dated subordinated notes a 'BBB' rating.

The notes are issued by AXA under a EUR14bn Euro Medium Term Note (EMTN) programme. The proceeds will be used to refinance existing subordinated debt maturing early 2014.

The notes have contractual maturity in 2043. The notes are also designed to be eligible for regulatory treatment of the required solvency margin or as T2 own funds following the implementation of Solvency 2.

Fitch regards this issuance as neutral to AXA's financial debt leverage and capital adequacy, as the new notes are replacing existing subordinated debt.

The notes receive 100% equity credit in Fitch's internal risk-based capital calculation based on regulatory override as eligible T2 instruments. Given the optional redemption date, the notes are also treated as 100% debt in financial debt leverage calculation by Fitch.

The issuance will lengthen the maturity profile of the group's financial debt. Moreover, this placement further underlines, in Fitch's view, AXA's financial flexibility, removing part of the 2014 refinancing risk.

Fitch currently rates AXA as follows:

--Insurer Financial Strength Rating of core insurance entities: 'AA-'; Outlook Negative

--Issuer Default Rating of AXA S.A.: 'A'; Outlook Negative

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