Fitch rates Omers Finance notes AAA

Fitch Ratings said it assigned a final rating of AAA to Omers Finance Trust's C$1 billion 2.6% senior unsecured medium-term notes due May 14, 2029.

The rating on the notes is equalized with Omers' long-term issuer default rating, reflecting the unconditional and irrevocable guarantee from Omers and its fully unsecured funding profile, Fitch said.

The company's leverage, defined as gross debt-to-net assets would increase modestly with this issuance, but Fitch said it expects it to remain low on an absolute basis and within rating expectations.

Increased leverage levels are further mitigated by a formal board-level limit of 0.10x on an adjusted basis, the agency said.

Liquidity is viewed as exceptionally strong given predictable and reliable contributions, cash on hand, liquid investments, investment income from Omers' broad investment mandate and the ability to use pension contributions to satisfy debt obligations, Fitch said.

The ratings reflect its exceptionally strong asset overcollateralization and liquidity levels, the agency said.

The ratings also consider the strong and improving funded status of the plan and Omers' ability to manage contribution rates and prospective benefits relative to the funded status, Fitch said.

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