Fitch puts American Equity on watch

Fitch Ratings said it placed American Equity Investment Life Holding Co.'s BB+ issuer default rating, BB $260 million 5.25% senior convertible debentures due 2024 and BB- trust preferred securities on Rating Watch negative.

The rating action follows American Equity's recent announcement that the company, its chairman and its chief executive officer and president received a Wells Notice from the Securities and Exchange Commission in connection with its ongoing investigation of some disclosures regarding transactions involving American Equity and American Equity Investment Service Co. The Wells Notice indicates that SEC staff is considering recommending a civil enforcement action against the company and some employees alleging violations against various federal securities laws.

The Rating Watch negative reflects Fitch's belief that there is a level of uncertainty that exists with respect to ramifications of the Wells Notice including, but not limited to, the potential result of a change in American Equity's leadership, which may materially disrupt the company's ability to execute on its near- and long-term strategic goals.

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