IAG has extended the terms of its £157 million ($234.7 million) subordinated exchangeable notes issue which was issued last year.

The notes were due to be redeemed, or exchanged for IAG shares, in October this year, but this has now been pushed out to December 2012.

The change of the redemption date has also reduced the coupon payment to LIBOR (London Interbank Offered Rate) plus 1.875%, compared to LIBOR plus 2.5%.

An IAG spokesman told insuranceNEWS.com.au the “opportunity arose to roll over the notes”.

IAG had $1.3 billion of interest-bearing liabilities on issue at December 31 last year.

Meanwhile, Allianz has placed €500 million ($663 million) of 30-year convertible subordinated notes with Nippon Life Insurance Company.

The notes can convert into Allianz shares after 10 years. 

Nippon Life President Yoshinobu Tsutsui says the purchase will enable the two insurers to create a long-term partnership.

Nippon Life is the world’s largest mutual life insurance company, with a capital base of ¥50 trillion ($579 billion) and total revenues of ¥6.6 trillion ($76 billion).