QBE has announced the immediate success of its $US250 ($473 million) of debt-based securities issue. Further funds of up to US$50 million may also be issued in the future.

In the event of repurchase, redemption or maturity, QBE has the option to pay cash or equivalent value in QBE shares or a combination of both.

In a statement late this morning, QBE said proceeds from the issue will be used to repay “certain bank loans on or before their maturity and to strengthen the balance sheet for rating purposes”. This is presumably to push the company from A+ to AA.

CEO Frank O’Halloran said the arrangement “will provide us with an opportunity to reduce the overall cost of our borrowings, provide a low-cost natural hedge for our US dollar shareholders’ funds and further strengthen our balance sheet”.