AXIS Capital subsidiaries renew $500 million letter-of-credit facility

By Angela McDaniels

Tacoma, Wash., Dec. 22 – AXIS Capital Holdings Ltd. said AXIS Specialty Ltd., AXIS Re SE, AXIS Specialty Europe SE, AXIS Insurance Co., AXIS Surplus Insurance Co. and AXIS Reinsurance Co. renewed their $500 million secured letter-of-credit facility with Citibank Europe plc for a four-year term.

The renewal happened Friday, according to an 8-K filing with the Securities and Exchange Commission.

Under the terms of the facility, up to $500 million may be used by the companies to issue letters of credit that will be principally used to support reinsurance obligations in the United States and elsewhere.

The facility has three tranches: a committed letter-of-credit issuance tranche with a sublimit of $179 million to be used for credit(s) denominated in a currency other than Australian dollars or New Zealand dollars, a committed letter-of-credit issuance tranche with a sublimit of $191 million to be used for credit(s) denominated in a currency other than Australian dollars or New Zealand dollars and a committed letter-of-credit issuance tranche with a sublimit of $130 million to be used for credit(s) denominated in Australian dollars or New Zealand dollars.

If a company fails to reimburse the bank for a drawing when promised, that company will pay interest on the unreimbursed amount at the rate of Libor plus 100 basis points.

The companies are subsidiaries of AXIS Capital Holdings, a Pembroke, Bermuda-based holding company for specialty reinsurance.

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