Mapfre has just completed a 1.0-billion-euro senior unsecured debt issuance, structured in two 500-million-euro tranches with maturities of six and ten years, at fixed interest rates of 3.125% and 3.625%, respectively, and aimed exclusively at professional investors.

The transaction was completed on favorable terms under a new debt program, after attracting investor demand five times greater than the amount offered. The proceeds will be used to refinance upcoming maturities, maintain financial flexibility, and further diversify funding sources.

Outlined below are the five key aspects of the transaction:

1. What is the purpose of the issuance?

The proceeds of the 1.0-billion-euro issuance will be used to refinance an 857-million-euro senior bond ahead of its May maturity. The transaction is intended to meet the Group’s ordinary funding needs. At present, no extraordinary funding requirements are anticipated (for example, to support corporate transactions).

2. Why was this timing chosen? When did work on the transaction begin?

Mapfre was able to take advantage of a favorable environment, with market conditions currently supportive for fixed income. Interest rates remain at relatively low levels, enabling financing at a lower cost. In addition, “January is typically a portfolio-building month, with a very active primary market and strong investor demand for bonds,” explains Leandra Clark, Director of Investor Relations and Capital Markets.

To be in a position to seize this opportunity, “multiple teams worked intensively throughout 2025—including the Finance Area, Risk, General Counsel, Legal Department, and Investor Relations—to launch a debt issuance program (known as an EMTN), which provides the agility needed to access the market during an attractive window such as January. The program will also serve as a framework for future transactions,” Clark adds.

Total demand of more than 5.0 billion euros for a 1.0-billion-euro issuance “confirms a highly favorable technical backdrop, with investors showing strong appetite for Mapfre bonds,” adds Eduardo García Castro, an economist at Mapfre Economics. “This appetite is further underpinned by risk-adjusted spreads that remain firm and are gradually tightening, reflecting a market with solid liquidity and confidence in the issuer’s credit quality,” he concludes.

3. Why these maturities and why senior bonds?

The Group’s capital structure is very stable and is predominantly composed of equity.

For Mapfre, a senior bond issuance such as this represents above all “an additional source of long-term funding alongside equity, allowing us to preserve financial flexibility for future issuances.” By issuing in two tranches, “we have diversified the maturity profile to avoid having to refinance a large volume in a single year,” Clark adds.

Given the Group’s current solvency ratio of 210%, which is above the midpoint of its publicly stated target range (175%–225%), Mapfre issued senior unsecured debt with a fixed maturity that does not have loss-absorption capacity and therefore does not qualify as regulatory capital.

Solvency regulation is designed to ensure that insurers maintain adequate capital levels. Accordingly, in addition to senior debt, Mapfre already has three subordinated instruments on its balance sheet which, although structured as debt, are included in the calculation of the Group’s solvency ratios and do have loss-absorption capacity.

Mapfre’s strategic objective is to maintain a leverage ratio of around 24%. With its current disciplined approach to capital and debt management, the company is keeping its leverage below that target level.

4. How does Mapfre’s balance sheet compare with those of other major insurance groups?

Mapfre’s balance sheet has a distinctly conservative profile. This is reflected in relatively low debt levels compared with peers and in the fact that “our solvency ratio shows lower sensitivity to market movements,” notes Leandra Clark.

Another key differentiating strength of Mapfre’s balance sheet is its investment portfolio, which is “highly diversified, focused on liquid instruments and largely investment grade,” says Beatriz Ranea from the Investor Relations team. This financial strength has led the main credit rating agencies to improve Mapfre’s outlook and ratings in the markets over the past year.

5. Are there any other factors behind the success of the issuance?

“Our philosophy within the Investor Relations team is to work continuously with our fixed-income investor base, regardless of whether we have an immediate need to access the market,” explains Leandra Clark. “Over the past 18 months, we have attended around 25 conferences in several countries—including Germany, Italy, France, the United Kingdom, Denmark, Finland, the Netherlands, and, of course, Spain—in many cases accompanied by members of senior management. We have organized events with investors and analysts and expanded the information provided in our presentations, with the aim of facilitating the preparatory work fixed-income investors need to undertake in order to decide to participate in our issuance.”