Munich Re’s Places its First Subordinated Bond in US Market

Published on: 25 May 2022 07:24 PM

Munich Re, a German global insurance business, has issued its first green subordinated bond in a private placement to qualified institutional buyers in the United States under Rule 144A and outside the United States under Regulation S of the United States Securities Act of 1933.

Munich Re has expanded and diversified its investor base by issuing this bond in the globally important US $144A market segment. The issuance is worth US $1.25 billion. The bond has a 5.875% rate and will mature in 2042.

Munich Re's commitment to the Paris Climate Agreement is reflected in the green bond, which supports the company's strategic goal of considerably boosting investments in energy efficiency and renewable energy to combat climate change.

Munich Re plans to use the funds collected to fund or refinance sustainable projects under its Green Bond Framework. Renewable energy, energy efficiency, clean transportation, green buildings, sustainable water and wastewater management, eco-efficiency and/or circular economy, and environmentally friendly natural resource and land management are among the projects.

Christoph Jurecka, CFO of Munich Re, said:

"By successfully placing its first subordinated bond on the US market, Munich Re has impressively demonstrated its attractiveness for new groups of investors. In structuring this bond as a green bond, we are the first European insurer to break new ground in this market segment. At the same time, the green bond supports the climate targets of our Ambition 2025 strategy."

Source: Munich Re's