Insurance Regulatory Capital

Subordinated Debt

IRC’s subordinated debt product is tailored to match the requirements set out in the regulations for Tier 2 capital under Solvency II.

Sub debt is specifically constructed to be a hybrid instrument between debt and equity.  As such, an issuer receives all the benefits of debt (tax deductible, fixed rate, long term but finite) without the drawbacks of equity (dilution of control, expensive, high administration, non-flexible). In addition, under Solvency II guidelines sub debt instruments are designed to alleviate financial pressure in times of stress. This new note structure offers a more attractive proposition for issuers.

Solvency II Subordinated Debt Characteristics