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Qatar Re positioned well for growth after successful capital raise

9th March 2017 - Author: Luke Gallin

Bermuda headquartered Qatar Reinsurance Co. (Qatar Re), the reinsurance subsidiary of Qatar Insurance Co. (QIC), has said the successful completion of its significantly oversubscribed $450 million perpetual bond debt issuance positions it well for future expansion.

The issue attracted more than 290 orders for more than $6.5 billion, oversubscribing by roughly 14 times, achieving impressive global distribution with 30% coming from Asia, 29% from the UK, 20% the Middle East, 19% from Continental Europe, and then 2% coming from other regions around the globe.

“Interest from investors was outstanding following an extensive roadshow. This new USD 450m issue reinforces our efficient capital structure that offers excellent security to policyholders and positions us well for the next phase of growth,” said Khalifa Abdulla Turki Al Subaey, Group President and Chief Executive Officer (CEO) of Qatar Insurance Co. Group.

The company continues to explain that the debt issuance will enable it to respond and meet increased demand for its services, while supporting its comprehensive service proposition with significant capacity.

As reported previously, the initial coupon for the bond has been set at 4.95% per annum, and will be fixed until the first call date in September 2022, “and reset to 5yr MS plus the initial margin, and every 5 years thereafter,” explained the re/insurer.

From a regulatory standpoint the notes will be treated as Tier 2 capital in Bermuda for reinsurer Qatar Re, and also in Qatar for QIC. International rating agency Standard & Poor’s (S&P) has assigned the notes a rating of BBB+.

According to a statement from the firm, settlement of the notes is due to take place on 13th March, 2017. BNP Paribas was the sole structurer of the transaction, and alongside HSBC acted as a Global Coordinator. BNP, HSBC, ENDB, and NBAD acted as both joint bookrunners and joint lead managers.

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