AmTrust restates credit agreement for £235 million facility due 2019

By Marisa Wong

Madison, Wis., Dec. 1 – AmTrust Financial Services, Inc. amended and restated its £200 million credit facility agreement with ING Bank, NV, London Branch, according to an 8-K filing with the Securities and Exchange Commission.

The amended and restated credit facility increases the maximum amount of the letter-of-credit facility to £235 million.

The restated facility is to be used to support the company’s capacity at Lloyd’s as a member or reinsurer of Syndicates 2526, 1206 and 44 for the 2015 underwriting year of account, as well as prior open years of account.

The ability to have letters of credit issued under this amended facility expires on Dec. 31, 2015, and the maturity date for the facility is July 31, 2019.

The facility is 40% secured by a pledge of a collateral account established in the United States under a pledge and security agreement and in the United Kingdom under a deed of charge dated Nov. 26, 2013.

The collateral account will be required to be 100% funded upon the occurrence of specified events, including the A.M. Best financial strength rating of the account party falling below A-, the forecast underwriting losses exceeding a certain level for any year supported by a letter of credit or any non-extension notice being given with respect to any letter of credit.

Under the restated credit facility, the company pays a letter-of-credit issuance fee on the secured portion of the letters of credit at the rate of 0.50% and on the unsecured potion at a rate based on the account party’s then-current financial strength rating issued by A.M. Best.

As of Nov. 25, the applicable letter-of-credit fee on the unsecured portion was 1.15%.

The company also pays a commitment fee of 0.35% per year on the total unutilized and uncancelled amount of the facility and a facility fee upon closing of 0.15% of the total commitment.

The company entered into the amended and restated agreement on Nov. 25 with four of its wholly owned subsidiaries, AmTrust International Insurance, Ltd., AmTrust Corporate Capital Ltd., AmTrust Corporate Member Ltd. and AmTrust Corporate Member Two Ltd.

AmTrust is a New York-based insurance company.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.