Moody’s rates Principal Financial notes Baa1

Moody's Investors Service said it assigned a Baa1 senior debt rating to about $650 million of senior notes to be issued by Principal Financial Group, Inc.’s guaranteed senior unsecured debt at Baa1 under an existing shelf registration with the Securities and Exchange Commission.

The notes will be issued in tranches of $350 million and $300 million due in 10 and 30 years, respectively, the agency said. The debt will be guaranteed by Principal Financial Services, Inc., PFG's intermediate holding company.

The outlook is stable.

The proceeds from two issuances will be used to help redeem up to $800 million of senior debt under separate tender offers, Moody’s said.

The agency said the ratings on the notes are based on a full, unconditional and irrevocable guarantee from Principal Financial Services, the direct owner of Principal Life Insurance Co., which is a major U.S. pension and life insurance provider.

Moody's added that the new issuances, which will refinance senior notes due in 2017 and 2019 and partially repay notes due in 2036, will reduce total debt outstanding somewhat and help to better ladder remaining maturities.

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