Moody’s places ratings of 3 AMP units on review for downgrade

Moody's on March 2 placed the ratings of AMP Group Holdings Ltd., AMP Group Finance Services Ltd. and AMP Bank Ltd. on review for downgrade, following Ares Management Corp.'s partnership to acquire a 60% stake in AMP Ltd.'s private markets businesses.

The proposed deal will allow Ares Management to have management control of the private markets businesses while AMP will retain a 40% stake. If executed, the transaction would bring significant changes to AMP's business mix. The outlook on the three entities was previously stable, the rating agency said.

The review for downgrade will specifically consider the impact on the growth potential of the AMP group, its geographic and product diversification, the impact on the group's profit profile with respect to margins and stability of profits, and the impact on the group's financial leverage.

AMP Bank's "baa2" adjusted baseline credit assessment, as well as its long-term issuer and backed domestic senior unsecured ratings, were placed on review for downgrade, reflecting the potential for a reduction in affiliate support from AMP Group Holdings, which provides a guarantee for the bank.