Industrial Alliance Insurance and Financial Services Inc. has closed its previously announced domestic offering of $100 million of 8.25% subordinated debentures due March 27, 2019, the company said Friday.

The debentures bear interest at a fixed annual rate of 8.25% for the first five years, payable semi-annually, and a variable annual rate equal to the 90-day Bankers’ Acceptance Rate plus 7.55% for the last five years, payable quarterly. The debentures are redeemable by Industrial Alliance subject to certain conditions.

The debentures have been rated “A” with a stable trend by DBRS Limited and “A” by Standard & Poor’s.

Industial Alliance said the net proceeds from the offering will be used for general corporate purposes. The debentures qualify as Tier 2 capital.

On a pro forma basis, the Industrail Alliance estimates that, as at December 31, 2008, this issue increased the solvency ratio from 199% to 209%. The company targets a solvency ratio between 175% and 200%.

The debentures were offered on an agency basis by a syndicate of dealers co-led by RBC Dominion Securities Inc. and Scotia Capital Inc., and which includes National Bank Financial Inc., TD Securities Inc., BMO Nesbitt Burns Inc., CIBC World Markets Inc., Desjardins Securities Inc., Casgrain & Company Limited, HSBC Securities (Canada) Inc., Industrial Alliance Securities Inc. and Laurentian Bank Securities Inc.

IE