Moody's rates Voya securities Baa2

Moody's Investors Service said it assigned a Baa2 debt rating to about $500 million of pre-capitalized trust securities ("P-Caps") issued by Peachtree Corners Funding Trust, a Delaware statutory trust that will act as a source of liquidity for Voya Financial, Inc. The outlook on the P-Caps is stable.

Moody's said that under the terms of the facility, Voya Financial has the right to issue senior notes due 2025 guaranteed by Voya Holdings, Inc. to the trust in exchange for high-quality collateral. The collateral will be held in the trust for the benefit of investors, purchased with the proceeds raised from the issuance of the P-Caps.

"This transaction is a credit positive because it provides Voya Financial with an alternative source of liquidity and diversifies its funding sources,” Moody’s vice president and senior credit officer Laura Bazer said in an agency news release.

Moody's said the ratings of Voya Financial and its life insurance subsidiaries are based on the companies' sizable share in domestic retirement services, strong capital, strong holding company liquidity and the agency’s expectation of ongoing, improving profitability.

The agency said that these strengths are mitigated by the company's significant exposure to the U.S. equity market from its large book of legacy variable annuities and fee-based pension businesses.

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