I’ve just had a tip off from a friendly investment manager that Liberty Mutual have increased the size of their catastrophe bond deal Mystic Re II 2009-1 (yes, we now believe it is called II despite earlier confusion) from $200m to $225m. The reason being given is investor demand, which is a great sign for the cat bond market and testament to the improvements in deal structure which all recent deals have adopted.
With investor appetite seemingly alive and well and increasing as hedge funds and the like seek out assets with a decent return on investment the market looks set to have a much better year. Further improvements can be made and we expect to see new innovations being brought to market soon, particularly around trigger structure.
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