CAA announces the success of a new €1-billion subordinated note issue on the markets

What is a “subordinated note”?

A subordinated note is a loan whose repayment does not take priority in the event of the issuer's bankruptcy or liquidation. The issuer of a bond borrows money from investors and pays them interest in exchange, usually in the form of an annual payment. It constitutes an own-funds item that is eligible for the solvency margin requirement.

Success among investors

CAA's July transaction attracted a large number of investors, whose bids amounted to more than three times the issue amount targeted by Crédit Agricole Assurances.* These bonds were eventually placed with 170 institutional investors, mainly located in Europe. The quality and diversity of the bids received reflect investors’ positive perceptions of Crédit Agricole Assurances.
 

What are CAA’s goals? 

These ten-year notes, bearing interest at 2.00%, will be included in the composition of Solvency 2 regulatory capital. The transaction was completed in a matter of weeks and took place in a particularly favourable financial context.

“The purpose of this issue is to optimise and extend the maturity profile of the Crédit Agricole Assurances Group's debt, to diversify CAA's investor base, and also to take advantage of particularly favourable market conditions to repay intra-group debt with Crédit Agricole S.A.
 
At the Crédit Agricole Group level, this issue is intended to improve Crédit Agricole S.A.’s regulatory solvency ratios and Standard & Poor's ratios.”

                 Marie-Isabelle Marcellesi, 
Head of Financial Communications
and Corporate Finance

*a total of €3 billion of investment bids