S&P downgrades If P&C Insurance

S&P said it lowered If P&C Insurance Holding Ltd.'s long-term issuer rating to BBB- from BBB on its tier 2 junior subordinated debt.

Under the methodology for rating junior subordinated debt issues, S&P said it now rates the notes three notches lower than the A- long-term issuer credit rating on If P&C Holding.

The rating on the notes reflects their subordination and interest deferral features, the agency said.

As Sampo's regulatory capital position evolves, S&P said it could alter the notching on the notes to reflect changes in the likelihood of default.

The rating on the junior subordinated debt issued by operating company If P&C Insurance Ltd. is unchanged because its mandatory deferral trigger refers to the If Group and If P&C Insurance, and not Sampo Group, the agency explained.

The group's financial leverage is expected to remain in line with base-case assumptions over the next few years, S&P said.

Sampo's financial leverage ratio is expected to remain lower than 40% over the next few years, the agency said.

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