Feb. 28 (Bloomberg) -- Credit-default swaps on QBE Insurance Group Ltd. tumbled to the lowest in almost four months after the company said it would sell shares to replace debt.
The cost of the contracts fell 25 basis points to 300 as of 11:18 a.m. in Sydney, according to Westpac Banking Corp. That’s on course for the biggest daily decline since Dec. 13, and the lowest level since Oct. 31, according to CMA, which is owned by CME Group Inc. and compiles prices quoted by dealers in the privately negotiated market.
Trading in QBE’s shares was halted today while the insurer undertakes a capital raising to replace $500 million of its tier 2 convertible debt, according to a regulatory filing. The move involves selling shares to institutional investors and a share purchase plan for retail investors, QBE said.
Frank O’Halloran will step down as chief executive officer, QBE said in a separate statement.
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