This week QBE Insurance Group Ltd was rumored to be arranging a series of investor meetings in Asia and Europe about a potential Tier 2 transaction. The question is why they wouldn’t tap the listed retail market? The answer is cost. The listed market continues to be an expensive avenue to issue regulatory capital for institutions, except where they can use franking credits to compensate investors. This type of security is an excellent part of an investment portfolio and has been making up the majority of institutional funds for many years. We hope that in the future the cost of this type of security will reduce, making them more accessible for retail investors.