Fitch rates Friends Provident securities A-

Fitch Ratings said it assigned Friends Provident plc's dual-tranche issue of step-up tier one insurance capital securities (Stics) an expected A- rating.

The agency said proceeds will be used partly to finance subordinated debt maturing in 2006, with the rest used to fund growth.

The Stics will be issued in sterling and euro, Fitch said, and they rank pari passu with preference shares, but junior to the existing Stics (A-) issued in 2003.

Due to subordination, Fitch said it believes there is a difference in the credit risk associated with this instrument, but this is insufficient to justify further notching of the new securities.

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