Chola MS General Insurance raises Rs 100 crore of Tier 2 Capital

MUMBAI: Cholamandalam MS General Insurance raised Rs 100 crore through non-convertible debentures to fuel growth.

The coupon rate is 8.75% per annum and a maturity period of 10 years with a call option after 5 years.

"We have augmented our capital base by issuing subordinated debt,” said S S Gopalarathnam, MD & CEO, Chola MS General Insurance. “The funds raised through this issue would be used to fuel and facilitate business growth by further strengthening the Company’s solvency.”

Recent, the Insurance Regulatory and Development Authority of India (IRDAI) had allowed alternative forms of capital. Chola MS is looking to grow its gross written premium by 40% to Rs 4,500 crore.

The company had solvency ratio of 1.63 at the end of March 31, 2017.

The NCDs have been assigned a credit rating AA+ (Outlook: Stable) by rating agencies CRISIL and ICRA. The NCDs will be listed in National Stock Exchange of India Limited.