OREANDA-NEWS. Fitch Ratings has assigned AXA S.A.'s EUR1.5bn dated subordinated notes a 'BBB' rating.

KEY RATING DRIVERS
The notes are rated three notches below AXA's 'A' Issuer Default Rating (IDR), two for a recovery assumption of "Poor" and one for moderate non-performance risk. The notes are issued by AXA under a EUR15bn euro medium term note (EMTN) programme. The proceeds are being used to refinance part of the outstanding debt.

According to the terms and conditions, the new bond qualifies for Tier 2 capital recognition under Solvency II. The notes receive 100% equity credit in Fitch's Prism Factor-Based Model, due to the application of the regulatory override. The notes are also treated as 100% debt in Fitch's financial debt leverage calculation.

Fitch views the issue as neutral for AXA's financial debt leverage and capital adequacy, as the new notes are issued for refinancing purposes.

The issue will lengthen the maturity profile of the group's financial debt. Moreover, in Fitch's view, the issue further underlines AXA's financial flexibility, by alleviating refinancing pressure in the medium term.

RATING SENSITIVITIES
The notes' rating is subject to the same sensitivities that may affect AXA's Long-term IDR (for more details, see 'Fitch Affirms AXA Entities' IFS at 'AA-'; Outlooks Stable' dated 6 October 2015 at www.fitchratings.com).

Fitch currently rates AXA as follows:

-Insurer Financial Strength Rating of core insurance entities: 'AA-'; Outlook Stable
-Issuer Default Rating of AXA S.A.: 'A'; Outlook Stable

Date of Relevant Rating Committee: 5 October 2015