Bermuda domiciled reinsurance firm hailed the completion of its recent significantly oversubscribed $450 million perpetual bond debt issuance today, saying that it takes the reinsurers capital passed the $1 billion mark.
Size still does matter in reinsurance, with some cedents continuing to tier their reinsurance panel based on factors such as size, capitalisation, ratings etc.
CEO of Qatar Re Gunther Saacke explained; “The issuance has taken our company beyond the US$ 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.”
Importantly for Qatar Re the issuance of a debt instrument is seen as a way to increase capital efficiency, which in the current reinsurance market environment is a vital tool for managing the softened and competitive space.
Saacke explained how the debt issuance assists; “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.”
