Tuesday 14, March 2017 by Georgina Enzer

Qatar Re issues $450 million perpetual non-call 5.5 year subordinated Tier 2 notes

Qatar Reinsurance Company Limited (“Qatar Re”), a subsidiary of Qatar Insurance Company S.A.Q. (“QIC”), has issued $450 million Reg S Perpetual non-call 5.5 subordinated Tier 2 notes guaranteed on a subordinated basis by QIC to institutional investors, representing its debut issuance in the international debt capital markets.

The issue attracted over 290 orders of more than $6.5 billion and achieved a balanced global distribution of investors comprising 30 per cent Asia, 29 per cent UK, 20 per cent Middle East, 19 per cent Continental Europe and two per cent from other regions.

The initial coupon has been set at 4.95 per cent per annum. It will be fixed until the first call date in September 2022 when it will be reset to 5yr MS plus the initial margin, and will be reset every five years thereafter.

The notes have been assigned an issue rating of “BBB+” by S&P Global Ratings and provide eligible Tier 2 capital to further enhance Qatar Re’s financial strength. Qatar Re continues to benefit from a rating of “A/Stable” from S&P Global Ratings and “A (Excellent)” from A.M Best.

“With the introduction of tradable notes, Qatar Re is seizing the opportunity to finance future growth on the back of a modern efficient capital structure. The notes have reduced our cost of capital and are a significant milestone on our path to establishing Qatar Re in the top tier of our industry.” He continued, “The issuance has taken our company beyond the $1 billion capital mark; an important threshold to potential clients who make this a prerequisite. The increased capital strength will enable us to respond to increasing demand from existing and new clients for substantial capacity as part of our comprehensive service proposition,” said Gunther Saacke, Qatar Re’s CEO.

BNP Paribas acted as sole structuring adviser on this transaction. Joint bookrunners were BNP Paribas, HSBC Bank, Emirates NBD and National Bank of Abu Dhabi.

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