Athora (AO) | Hold Tier2/Buy RT1 | Tier2 5.375% 32NC27 downgraded to Hold Buy RT1 6.75% PNC2031

Research evidence excerpt

Athora (AO) | Hold Tier2/Buy RT1 | Tier2 5.375% 32NC27 downgraded to Hold Buy RT1 6.75% PNC2031

Release date: 23 June 2026

Sébastien Barthélemi

Head of Credit Research

+33 1 70 39 74 76

sbarthelemi@keplercheuvreux.com

Hold Tier2/Buy RT1 (Buy Tier2/RT1)Athora

Bermuda | Insurance

Moody's: NR

Fitch: A s

Composite: NR

Bloomberg: ATHORA

Tier2 5.375% 32NC27 downgraded to Hold — Buy RT1 6.75% PNC2031

Key points:

Athora announced a tender offer at 102.15% for its existing EUR500m 2032 Tier2 bond callable in May 2027, alongside plans to

issue a new EUR500m subordinated Tier2 2037 bullet to refinance the liability. If 20% or less of the existing bond remains

outstanding after the tender, Athora has announced its intention to exercise the clean-up call at par.

The refinancing is broadly leverage-neutral and aligns with Athora’s ongoing capital management strategy. In this context, the

premium embedded in the existing 5.375% NC27 Tier2 has narrowed. While the bond still screens reasonably on a relative value

basis, the call is now fully priced in. We downgrade our recommendation to Hold, as the potential for further spread tightening

appears limited.

On the RT1 side, Athora’s 6.75% PNC31 continues to trade at a meaningful premium to RT1 peers, reflecting its smaller

scale, lower market recognition, and BBB index composite rating. We have a Buy recommendation, as the bond continues

to offer an attractive carry, one of the highest reset spreads in the cohort, and exposure to a credit profile that has

strengthened.

The GBP5.7bn acquisition of Pension Insurance Corporation Group (PICG), funded by a EUR3.5bn common equity raise, further

enhances Athora’s scale and business profile, bringing it closer to more established European insurance peers. The transaction