Axa plans to invest €10bn in infrastructure debt over next five years

Axa, Europe’s second-largest insurer, plans to invest €10 billion in infrastructure debt over the next five years as low interest rates push European insurers to seek new investments.

Axa will invest in infrastructure loans through the real-estate business of its Axa Investment Managers unit, the Paris- based insurer said.

Axa Real Estate will underwrite loans of as much as €500 million, it said. It had appointed Charles Dupont to lead a new team of professionals working on infrastructure-lending investments, the division said.

"It meets our need to find long-term investments and diversify our credit portfolio in order to match the guarantees we offer clients," according to Axa's chief investment officer, Laurent Clamagirand.

Axa, like French rival CNP Assurances and Zurich-based Swiss Re Ltd, is shifting new investments toward corporate and infrastructure debt following Europe's sovereign-debt crisis.

Axa, which had €491 billion of invested assets at its insurance operations at the end of 2012, targeted 40 per cent of new fixed-income investments to corporate bonds, 30 per cent to government bonds and 7 per cent to loans, it said in February.

Axa rose 1.5 per cent to €16.08 in early Paris trading and has gained 21 per cent this year, reaching a market value of about €38.5 billion.

Axa Real Estate has already identified a “strong pipeline of potential investments”, it said in a separate statement.

The insurer signed an accord this month with Commerzbank to invest in corporate lending in Germany, Austria and Switzerland, mirroring partnerships it started in France last year with Societé Génerale and Crédit Agricole's corporate and investment bank.

CNP Assurances, France's largest life insurer, said last week it would invest as much as €2 billion in infrastructure loans over the next three years through a new partnership with Natixis. – (Bloomberg)