Moody's rates American Financial Group debt

Moody's Investors Service said it assigned a Baa3 senior debt rating to the $100 million 30-year senior unsecured debentures issued by American Financial Group Inc.

Proceeds from the issuance are expected to be used to redeem about $95.5 million of the company's outstanding trust preferred securities that mature in October 2026.

The outlook remains stable.

Moody's said the debt issuance represents an opportunity for the holding company to refinance relatively high interest trust preferred securities with lower interest, long term debentures. After the new debt issuance and subsequent redemption of the trust preferred securities, Moody's said it expects the company's consolidated financial leverage (including trust preferred securities) to be in the mid 30% range. Longer term, Moody's expects that the company will continue to reduce its relatively high financial leverage profile closer to 30%.

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