See accounting policy AA.
|||Nominal amount||Carrying value 2022||Carrying value 2021|
|Hybrid Tier 2 instrument 5.125% fixed interest||500||499||498|
|Hybrid Tier 2 instrument 3.375% fixed interest||500||495||494|
|Hybrid Tier 2 instrument 7.000% fixed interest||1,000||987||-|
|Total subordinated liabilities||2,000||1,980||992|
In 2015, a.s.r. issued € 500 million subordinated liabilities in the form of Tier 2 notes, first callable on 29 September 2025, and maturing on 29 September 2045. The coupon is fixed at 5.125% and paid annually on 29 September with a step up at the first call date.
In 2019 a.s.r. issued € 500 million subordinated liabilities in the form of Tier 2 notes. The Tier 2 notes have a maturity date of 2049 and are first callable 3 months before the first reset date of 2 May 2029. The coupon is fixed at 3.375% and paid annually on 2 May. After the reset date the interest is calculated based on the 5 Year Mid Swap Rate plus a margin of 4.00 per cent and updated once every five years.
On 22 November 2022 a.s.r. issued € 1 billion subordinated liabilities to partially finance the intended business combination with Aegon Nederland N.V., see chapter 6.4.5. As of the moment the business combination is completed the subordinated liabilities will qualify as a Tier 2 instrument. These Tier 2 notes have an M&A call clause, which gives a.s.r. the option to redeem the Tier 2 notes early if the acquisition of Aegon Nederland N.V. does not take place within 12 months or will not take place at all. The Tier 2 notes have a maturity date of 2043 and are first callable on 7 December 2033. The coupon is fixed at 7.000% and paid annually on 7 December.
These Tier 2 notes are subordinated and ranking equally without any preference amongst themselves and (a) junior to the claims of all senior creditors of a.s.r., (b) equally with any parity obligations and (c) in priority to claims in respect of (i) any equity securities and (ii) any junior obligations.
The subordinated liabilities are classified as liabilities given the obligation to settle the loans and pay the coupon. The subordinated liabilities issued in 2015 and 2019 are considered Tier 2 own funds for regulatory purposes. The subordinated liabilities issued in 2022 will be considered Tier 2 own funds for regulatory purposes as of the moment the business combination with Aegon Nederland is completed.