AM Best assigns bbb rating to Intact Financial subordinated notes
Intact Financial Corporation secures a new long-term issue credit rating for its recently issued subordinated notes as the Canadian insurer manages funding and capital structure. The CAD 250 million notes carry a stable outlook, while the proceeds support general corporate purposes and debt repayment.
Highlights
- AM Best assigns a 'bbb' Long-Term Issue Credit Rating with stable outlook to Intact Financial's CAD 250 million, 6.133% subordinated notes due 2086.
- Net proceeds from the notes will be used for general corporate purposes and to repay debt, with Series 3 Preferred Shares to be redeemed on Sept. 30, 2026.
- IFC's adjusted financial leverage improves to 18.5% in Q2 2026 from 19.2% at year-end 2025, with no impact on leverage assessment from the transaction.
Rating action and capital structure
As reported by AM Best, the ratings agency assigns a Long-Term Issue Credit Rating of "bbb" (Good) to Intact Financial Corporation's recently issued CAD 250 million, 6.133% fixed-rate subordinated notes due 2086, with a stable outlook.The net proceeds from the offering are being used for general corporate purposes and to repay all or part of IFC's debt borrowings. Intact also completes the redemption of its Series 3 Preferred Shares on Sept. 30, 2026.
Leverage trends and financial impact
Intact's adjusted and unadjusted financial leverage continues to improve through the second quarter of 2026. Including the new subordinated note offering and the preferred share redemption, the transaction has no impact on the corporation's financial leverage assessment.At the second quarter of 2026, IFC's adjusted financial leverage stands at 18.5%, compared with 19.2% at year-end 2025. Management's long-term target for debt to capital remains at 20%.
Our earlier coverage of ICRA’s rating action on REC Limited focused on the A1+ credit rating assigned to its short-term borrowing programme, alongside a reaffirmation of the company’s existing ratings. The update also noted that ratings on matured instruments were withdrawn, narrowing the review to active obligations and helping clarify which borrowings remain under ongoing monitoring.
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