QBE Insurance Group has issued a consent solicitation to holders of its US$400 million perpetual fixed rate capital notes to put forward proposed revisions to the terms and implementation.
In a regulatory filing on Monday, the insurer announced: “QBE is seeking the approval of holders to amend the terms of the capital notes to provide that, if the Australian Prudential Regulation Authority determines QBE would become non-viable, the capital notes would be written-off rather than converted into ordinary shares.”
The consent solicitation spans related implementing amendments.
According to QBE, the proposed change to the terms would align the loss absorption mechanism and the accounting equity treatment of the capital notes with the US$500 million perpetual fixed rate resetting capital notes issued by the insurance group on May 12.
“This means that the capital notes would be reclassified out of borrowings and into equity,” it explained.
