QBE to raise $1.3bn for COVID-19 buffer
Insurance giant QBE is embarking on a $US825 million ($A1.3 billion) raising to build a buffer against the impacts of the coronavirus pandemic.
The company, which also said premium growth had been strong in the first quarter, is the latest in a growing list of ASX-listed firms to tap shareholders for cash amid virus-driven uncertainty.
Similar moves have been made by Cochlear, Webjet, Flight Centre, Oil Search, Reece, Kathmandu and oOh!media in recent weeks.
QBE’s raising announced on Tuesday includes a fully underwritten $1.17 billion institutional placement at $8.25 per share, a 9.4 per cent discount to the last closing price of $9.11 on Thursday.
QBE will attempt to raise a further $117 million through a non-underwritten share purchase plan.
Despite disruption caused by the COVID-19 pandemic, QBE said insurance trading conditions across the group strengthened further during the first quarter.
Group-wide premium rate increases averaged 8.0 per cent – up from 4.0 per cent a year ago – including strong premium rate momentum across all divisions, particularly in North America and international.
Gross written premium increased by more than 9.0 per cent to $US4.5 billion ($A7.04 billion), reflecting premium rate increases coupled with solid volume growth assisted by improved retention in every division.
