S&P rates Promerica notes B+

S&P said it assigned its B+ global scale issue-level rating to Promerica Financial Corp.’s (PFC; B+/stable/B) proposed senior secured notes for up to $300 million. The tenure of the notes will be between five and 10 years.

The Panama-based holding company will use the proceeds mostly for full refinancing of its current debt structure and for business expansion. The issue-level rating on the notes is at the same level as the long-term global scale issuer credit rating on PFC.

“Our long-term B+ rating on PFC is one notch lower than the bb- group credit profile, given that PFC is a non-operating company and its debt is structurally subordinated to that of the operating companies. Due to PFC's exposure to Ecuador (B-/stable/B; 29% of loan portfolio), we ran a sovereign stress test, which the company passes. The Ecuador sovereign rating won't cap the ratings on PFC as long as the company continues to pass our stress test,” S&P said in a news release.

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