Swiss Re has announced that it has entered into a US$1 billion long-term letter of credit (L/C) facility with JP Morgan to support its US life business.

This 20 year L/C facility is the second phase of a programme initiated last year.

Replacement

The diversified global reinsurer says the new facility replaces its existing arrangements to support US regulatory capital requirements for its life business.

In December 2008, Swiss Re said it had entered into a US$1.5 billion long-term L/C facility with JP Morgan.

Opportunities

Through the facility with JP Morgan, Swiss Re aims to obtain better access to long-term financing at competitive rates.

This would enable the reinsurer to tap into what it sees as significant investment opportunities for well-capitalised reinsurance companies in the context of difficult conditions in the world's financial markets.

Swiss Re reckons it is in a strong position to respond to increasing demands from clients for reinsurance solutions.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.