{"id":7051,"date":"2009-06-26T17:29:03","date_gmt":"2009-06-26T21:29:03","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=7051"},"modified":"2009-06-26T17:29:03","modified_gmt":"2009-06-26T21:29:03","slug":"empire-life-issued-673-sub-debt-in-may","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=7051","title":{"rendered":"Empire Life Issued 6.73% Sub-Debt in May"},"content":{"rendered":"<p>Assiduous Readers with extremely good memories will remember that <a href=\"http:\/\/www.prefblog.com\/?p=6457\">Empire Life was rated by DBRS in May<\/a>, at which time I speculated that a new issue might be coming out.<\/p>\n<p>Well, it did, but it was a private placement and I missed it. Their <a href=\"http:\/\/www.marketwirecanada.com\/mw\/rel_ca.jsp?id=990140&#038;k=empire\">press release<\/a> states:<\/p>\n<blockquote><p>The Empire Life Insurance Company (Empire Life) and E-L Financial Corporation Limited (E-L) (TSX:ELF)(TSX:ELF.PR.F)(TSX:ELF.PR.G) announced today that Empire Life offered in Canada, by way of private placement to accredited investors, $200 million principal amount of subordinated unsecured 6.73% fixed\/floating debentures (Debentures) due May 20, 2019. The offering is expected to close May 20, 2009.<\/p>\n<p>The Debentures will mature on May 20, 2019 and will bear interest at a fixed annual rate of 6.73% for the first five years, payable in equal semi-annual payments, and a variable annual rate equal to the three-month CDOR plus 5.75% for the last five years, payable quarterly. The Debentures have been provisionally rated &#8220;A (low)&#8221; with a stable trend by DBRS Limited.<\/p>\n<p>The proceeds will be used for regulatory capital and general corporate purposes, and to repay a $125 million subordinated debenture issued to E-L (subject to approval by the Superintendent of Financial Institutions). The proceeds from the Debentures are expected to qualify as Tier 2B capital for regulatory purposes.<\/p>\n<p>The issue has been offered on an agency basis by a syndicate of dealers co-led by RBC Dominion Securities Inc. and Scotia Capital Inc. Other syndicate members include: National Bank Financial Inc., TD Securities Inc., BMO Nesbitt Burns Inc., CIBC World Markets Inc. and HSBC Securities (Canada) Inc.<\/p>\n<p>Impact of the debentures issue on financial strength<\/p>\n<p>On a pro forma basis, the Company estimates that its Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio would increase from 201% to 219% (as at March 31, 2009) following the issue of these Debentures and repayment of the E-L debenture.<\/p><\/blockquote>\n<p>Remember that as preferred shareholders in the holding company (ELF.PR.G, ELF.PR.F) we don&#8217;t care all that much about the MCCSR of the operating subsidiaries.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Assiduous Readers with extremely good memories will remember that Empire Life was rated by DBRS in May, at which time I speculated that a new issue might be coming out. Well, it did, but it &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-7051","post","type-post","status-publish","format-standard","hentry","category-issue-comments"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/7051","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=7051"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/7051\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7051"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7051"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7051"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}