Tokio Millennium Re sponsors Omamori private catastrophe bond

by Artemis on January 21, 2014

Global reinsurance firm Tokio Millennium Re AG has sponsored its first catastrophe bond, with the successful placement of a $25m private deal, named Omamori, through Tokio Solution Management Ltd‘s private cat bond platform Tokio Tensai™.

Tokio Solution, the collateralized reinsurance and insurance-linked securities arm of reinsurer Tokio Millennium Re, and GC Securities, the capital market division of broker Guy Carpenter, have successfully placed Omamori, a $25m notional private catastrophe bond, using the Tokio Tensai™ platform.

Shima Reinsurance Ltd., the reinsurance transformer vehicle of the Tokio Solutions operated cat bond issuance platform, is the issuer of the private cat bond notes on behalf of the segregated account Omamori. Omamori are Japanese amulets, believed to provide good luck and protection to their keepers.

The Omamori private cat bond provides Tokio Millennium Re AG with a source of fully-collateralized second event retrocessional reinsurance protection against U.S. earthquakes and named storms.

GC Securities acted as placing agent for the Omamori private cat bond transaction, helping the Omamori transaction to gain the support of a panel of investors.

Tatsuhiko Hoshina, CEO of Tokio Millennium Re AG, commented on the completion of the firms first cat bond; “Omamori adds diversity to Tokio Millennium Re’s outwards reinsurance panel and the Tokio Tensai™ platform provides a cost effective way to access alternative forms of capital.” Omamori are Japanese amulets, believed to provide good luck and protection.

Kathleen Faries, CEO of Tokio Solution, added; “We are pleased to be bringing this transaction to the market and even more pleased to be a part of issuing Tokio Millennium Re’s first catastrophe bond. The Tokio Tensai™platform allows Tokio Solution to expand on the existing relationships it has with ILS investors, develop new relationships, and deepens our commitment to the convergence space.”

The Tokio Tensai™ platform offers an efficient mechanism for issuing private cat bonds to sponsors and investors, backed by firms with experience in the catastrophe bond issuance arena. Assisting Tokio Solution and GC Securities with this issuance are Mayer Brown as Deal Counsel, Bank of New York Mellon as Trustee and Settlement Agent, and CD&P as Bermuda Counsel.

The $25m Omamori catastrophe bond notes will be listed on the Bermuda Stock Exchange, which likely reflects the fact that these private cat bond notes have secondary liquidity and can be traded.

The Omamori private cat bond has been added to the Artemis Deal Directory.

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