40% of life insurers’ bank loans below investment grade: AM Best

September 18, 2019 by Editorial Staff

About three-quarters of the $40.6 billion in bank loans owned by the U.S. life/annuity companies are rated below investment grade, according to a new AM Best report.

The Best’s Special Report, titled, “Bank Loans: Low Credit Quality, But Manageable Exposure,” notes that bank loans are not yet widely held throughout the industry.

Bank loan holdings totaled over $54 billion in par value for the insurance industry as of year-end 2018. Life/annuity insurers own nearly three-quarters, at 74%, with property/casualty and health insurers owning 23% and 3%, respectively.

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Originally Posted at Retirement Income Journal on September 12, 2019 by Editorial Staff.