Insurance Australia Group Ltd: Tail risk scenarios fading as Greensill settles; reiterate Buy on IAG

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Insurance Australia Group Ltd: Tail risk scenarios fading as Greensill settles; reiterate Buy on IAG

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Insurance Australia Group Ltd

Tail risk scenarios fading as Greensill

settles; reiterate Buy on IAG

Maintain Rating: BUY | PO: 10.00 AUD | Price: 7.57 AUD

Greensill settlement removes tail risk; maintain Buy 29 May 2026

We expect Insurance Australia Group’s (IAG) announcement today that it has reached a Equity

settlement in the long-running Greensill case - relating to insurance exposures linked to

Freya Kong >>

trade receivables financing arrangements- to be welcomed. The net financial impact is Research Analyst

expected to be non-material for IAG (we believe <A$50m or ~5% of earnings) and Merrill Lynch (Australia) +61 2 9226 5840

removes a tail risk scenario for our Buy thesis. freya.kong@bofa.com

Stephanie Deeb >>

Research AnalystNM impact brings relief given size of potential exposures Merrill Lynch (Australia)

IAG does not expect the settlement to have a material impact on its financial position or stephanierebecca.deeb@bofa.com

FY26 results, based on the settlement terms and anticipated recoveries. This should

bring relief, given the size of potential aggregate exposures (A$4bn plus interest). The

settlement comes following Tokio Marine’s JPY47.6bn additional provision (~A$420m) Stock Data

taken at its FY25 results (20 May) based on an expected settlement of US$3bn.

Price 7.57 AUD

Credit Suisse and White Oak proceedings remain ongoing Price Objective 10.00 AUD

Remaining proceedings brought by Credit Suisse and White Oak entities against IAG and Date Established 22-May-2026

other parties remain ongoing. We understand a similar settlement is being sought, which Investment Opinion A-1-7

could bring further relief in the coming weeks.