It is not just the banks which feel forced to issue new securities to deal with the fallout of the GFC and the new financial regulations which are being implemented as a result. QBE Insurance Group has mandated banks for another USD 30 year (non-callable for 10 years) Tier 2 subordinated transaction.
QBE typically issues 30 year notes with interest resets and call options, having last issued USD and sterling denominated notes of this structure in May. Those transaction were to refinance the repurchase of USD$600 million of 2041 subordinated callable notes which had been issued by QBE capital Funding and £291 million subordinated callable 2041s were exchanged for Tier 2 instruments.
It seems the theme behind these transactions is the new notes are all deemed to be Tier 2 capital. While details of the latest transaction are not yet available, the fact the new notes will be Tier 2 implies they have a non-viability trigger for conversion into ordinary shares clause and an interest deferment clause in the same manner as the USD and sterling notes recently issued.