Posted on 01 Mar 2010
Hannover Re announced today that it has concluded a USD 500 million long-term letter of credit facility with Deutsche Bank. This facility will enable Hannover Re to make the most of further attractive growth opportunities in the US reinsurance market. The line of credit can be used to put up the collateral required by regulators for assumed technical liabilities.
Through the acquisition of the ING life reinsurance portfolio in 2009 Hannover Re has also acquired a policy administration platform and a team of mortality risk experts. "Having a perfect team combined with these new financial resources gives us a sound basis for leveraging the opportunities that will open up going forward," Ulrich Wallin, CEO of Hannover Re, noted. "We are striving to expand our business in the life market."
Hannover Re has the option to further increase the size of the facility above and beyond the initial USD 500 million to support additional business. The facility has a maturity of thirty years, with an early termination option exercisable by Hannover Re at specified times. The pricing is fixed through the first optional redemption date.
This letter of credit facility will be used by Hannover Re solely to expand its life business.