Fitch rates Metropolitan Life note A(zaf)

Fitch Ratings said it assigned an expected A(zaf) national long-term rating to South Africa-based Metropolitan Life Ltd.'s proposed ZAR500 million unsecured subordinated callable notes due 2019. At the first call date in 2014, a step-up of 80% of the initial credit spread would apply and interest payments would convert from fixed to floating. Fitch expects leverage to remain commensurate with the rating and coverage to remain very strong.

The agency said Metropolitan Life's rating reflects its strong business position in its chosen market of low/medium income, its solid capital position and its continuing international expansion within Africa. It also reflects the group's very strong Black Economic Empowerment credentials, which support its business position and prospects.

Partially offsetting these factors are the company's lack of an affiliation with a bank for distributing its products and the challenge to defend its business position in a highly competitive South African life insurance market, Fitch added.

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