HANNOVER, Germany, May 25, 2005 (PRIMEZONE) -- Hannover Re has today successfully issued a EUR 500 million hybrid capital bond via its subsidiary Hannover Finance (Luxembourg) S.A. As part of the transaction, existing holders of Hannover Re's EUR 350 million 2001/2031 hybrid capital bond issued in 2001 were offered an exchange into the new bond. Participation in the exchange amounted to EUR 211.85 million, which resulted in the issue of approximately EUR 240.5 million new bonds. In addition, a further approximately EUR 259.5 million of new cash was raised from the European capital markets via JPMorgan.
The new bond priced with a coupon of 5.0% to yield 168 basis points over the mid yield of the 10-year Euro-denominated swap rate. The issue has a perpetual maturity and is callable after ten years and on every interest payment date thereafter at the issuer's option. If the bond is not redeemed after ten years, the interest basis changes from fixed to floating rate, a stepped-up rate of 3-month EURIBOR +268 basis points.
"Given the extremely tough conditions in the capital markets in recent weeks, we are extremely pleased with the placement of this issue. With the exchange of our existing hybrid bond and the issue of additional new hybrid capital, we have used the current low level of interest rates to further optimise our capital base", said CEO Wilhelm Zeller. The hybrid capital issue will be viewed as solvency capital by the rating agencies and the German Federal Financial Supervisory Authority (BaFin).
For further information please contact:
Press and Public Relations / Investor Relations: Eric Schuh (phone: 0511 / 56 04-15 00, e-mail: eric.schuh@hannover-re.com) or
Press and Public Relations: Gabriele Handrick (phone: 0511 / 56 04-1502, e-mail: gabriele.handrick@hannover-re.com)
Investor Relations:
Gabriele Bodeker (phone: 0511 / 56 04-1736, e-mail: gabriele.boedeker@hannover-re.com)
Hannover Re, with gross premiums of approximately EUR 10 billion, is one of the largest reinsurance groups in the world. It transacts all lines of property/casualty, life/health and financial/finite-risk reinsurance as well as program business. It maintains business relations with more than 5,000 insurance companies in about 150 countries. Its worldwide network consists of more than 100 subsidiaries, branch and representative offices in 18 countries. The rating agencies most relevant to the insurance industry have awarded Hannover Re very strong insurer financial strength ratings (Standard & Poor's AA- "Very Strong" and A.M. Best A "Excellent").
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