Swiss Re issues $200-M unique bond offering
MANILA, Philippines - Swiss Reinsurance Co. Ltd. (Swiss Re) has obtained $200-million in coverage against North Atlantic hurricane and UK extreme mortality risk through its new Mythen Re program.
The bond issuance is the first time hurricane and mortality risks have been combined into a bond offering.
Swiss Re is a Swiss reinsurance company.
It is the world’s second-largest reinsurer, after having acquired GE Insurance Solutions. The company has its headquarters in Zurich, and operates through offices in more than 25 countries.
The issuance is comprised of two tranches of notes. The $120-million Class A notes, rated B+ by S&P, combine PCS North Atlantic hurricane risk with UK extreme mortality risk.
The second tranche, rated B- by S&P, provides $80 million in protection for North Atlantic hurricane risk.
Swiss Re Non-Life Risk Transformation head Martin Bisping said that the combination of hurricane and mortality risk is a significant innovation in the ILS market.
“This innovation has provided Swiss Re with an efficient way of bringing risks to the capital markets, in a new combination that we believe is attractive to investors,” Bisping added.
The Class A tranche covers extreme mortality in the UK and complements the list of countries covered by Swiss Re’s previously placed Vita programs.
The notes will run until the end of 2016, giving Swiss Re five years of protection for the life risk and four years for the non-life risk.
Swiss Re’s innovative multi-peril bond has met strong investor interest, which reflects the continued growing trust in Insurance-Linked Securities.
ILS remains a key part of Swiss Re’s Life and Non-life risk transformation strategy.
The notes were placed through Swiss Re’s newly created SPRV Mythen Re Ltd.
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