February 26th, 2019

GC Securities Acts as Sole Structurer and Placement Agent for First Cat Bond to Transfer Standalone Terrorism Risk to the ILS Market

Posted at 1:23 PM ET

GC Securities*, a division of MMC Securities LLC, a US registered broker-dealer and member FINRA/NFA/SIPC, today announced the placement of GBP 75,000,000 Series 2019 Principal At-Risk Variable Rate Notes issued through Baltic PCC Limited, a protected cell company domiciled in the United Kingdom, on behalf of Pool Re.

The cat bond provides multi-year, indemnity retrocession protection for terrorism risk in the United Kingdom and breaks new ground on multiple fronts. The innovative transaction is the first to transfer standalone terrorism risk to the insurance-linked securities (ILS) market, the first ever issuance in sterling and the first issuance to use Computational Fluid Dynamic modeling for the risk analysis. Baltic PCC is also the first protected cell company to issue a cat bond under the UK Risk Transformation Regulations 2017.

GC Securities served as the sole structurer and placement agent for the transaction.

Size

(GBP)

Covered Perils

Scheduled Maturity

Initial Annual Modeled Expected Loss

Interest Spread

£75,000,000

Terrorism Risk

(UK Commercial Property)

March 7, 2022

2.71%

5.90%

QUOTES

Des Potter, Managing Director, GC Securities

“It was a privilege to work with the Pool Re team on their inaugural and innovative cat bond transaction, which was well supported by a globally diverse panel of sophisticated ILS market investors.”

Shiv Kumar, President, GC Securities

“Executing this successful placement whilst the ILS market is processing losses from 2017 and 2018 demonstrates the strength and quality of Pool Re’s proposition and their market-leading risk analysis.  This type of innovation is a great example of the major role the UK market can play in broadening the ILS asset class.”

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*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities LLC, a US registered broker-dealer and member FINRA/NFA/SIPC. Main Office: 1166 Avenue of the Americas, New York, NY 10036. Phone: (212) 345-5000. Securities or investments, as applicable, are offered in the European Union by GC Securities, a division of MMC Securities (Europe) Ltd. (MMCSEL), which is authorized and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN. Reinsurance products are placed through qualified affiliates of Guy Carpenter & Company, LLC. MMC Securities LLC, MMC Securities (Europe) Ltd. and Guy Carpenter & Company, LLC are affiliates owned by Marsh & McLennan Companies. This communication is not intended as an offer to sell or a solicitation of any offer to buy any security, financial instrument, reinsurance or insurance product.

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