This catastrophe bond transaction provides per-occurrence PCS Index Protection for U.S. hurricane and per-occurrence Paradex Protection for European windstorms.
Guy Carpenter & Company, LLC, the leading global risk and reinsurance specialist, and GC Securities, today announced the completion of a USD80 million, two-class note issuance from a new 144A catastrophe bond vehicle, EOS Wind Limited, an Irish special purpose company incorporated with limited liability, to benefit Munich Re.
The EOS Wind Limited Class A Notes are exposed to U.S. hurricane events and utilize a state-weighted per occurrence PCS index trigger structure based on insured losses reported by PCS from a hurricane event. The Class B Notes are exposed to U.S. hurricane events and will use the same PCS index trigger as the Class A Notes, as well as European windstorm events which utilize a country-weighted Paradex trigger.
GC Securities was the sole bookrunner on the note issuance. The details of the catastrophe bond issuance are as follows:
|Series 2010-1 Notes||Size||Moody’s Rating||Expected Maturity||Coupon|
|Class A Notes||$50 million||Ba3||May 26, 2014||Treasury Money Market Fund Yield + 6.80%|
|Class B Notes||$30 million||Ba3||May 26, 2014||Treasury Money Market Fund Yield + 6.50%|
According to Chi Hum*, Global Head of Distribution, GC Securities, “GC Securities is pleased to have partnered with Munich Re, a seasoned sponsor of cat bonds, to access attractively priced capacity from capital markets investors. The investors have shown a willingness to support consistent issuers in the cat bond sector and very much appreciate the market presence of Munich Re.”
Henry Keeling, President & CEO – International Operations, Guy Carpenter & Company, stated that “This cat bond transaction broadens the existing deep relationship that Guy Carpenter enjoys with Munich Re beyond the traditional markets to include accessing capital markets capacity. This is a great base from which to build productive partnering ventures in the future.”
*Securities or investments, as applicable, are offered in the United States through GC Securities, a division of MMC Securities Corp., a US registered broker-dealer and member FINRA/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., which is authorized and regulated by the Financial Services Authority. Reinsurance products are placed through qualified affiliates of Guy Carpenter & Company, LLC. MMC Securities Corp., 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. Chi Hum is a registered representative of MMC Securities Corp.