Two Resilience Re private cat bonds have maturity extended further

by Artemis on April 18, 2018

Two private catastrophe bond transactions that were issued through the Resilience Re Ltd. platform, which is owned by Willis Towers Watson Securities, have had their maturities extended further, likely to allow for loss development to continue.

The first, a $63 million Resilience Re Ltd. (Series 1711A) private catastrophe bond transaction, had already had its maturity extended by six months to July 8th, as we reported previously here.

The reason for the extension is unknown, but it’s likely to allow the beneficiary of the reinsurance or retrocession to wait for losses to develop further before a default determination is made.

But now, the $63 million of zero-coupon private catastrophe bond notes issued through the Resilience Re 1711A transaction have had their maturity further extended, right through to December 31st 2019, according to a BSX filing.

That’s a particularly long extension and it’s possible that the losses may be understood sooner and the sponsor receive its payout much quicker than that. However it does mean that investors in the private cat bond notes could be waiting to find out for more than a year and a half, if the sponsor chose to keep the extension in-force.

A second Resilience Re private cat bond has also had its maturity date extended now, the $173 million Resilience Re Ltd. (Series 1741A) zero coupon transaction, which was also issued using the Willis Towers Watson Securities private cat bond platform.

This is one of the largest privately placed cat bonds we’ve seen, at least through one of the platforms that more typically play host to cat bond lites.

The single $173 million Series 1741A tranche of discounted zero-coupon participating notes issued by Resilience Re Ltd. have now had their maturity extended through to May 1st 2019.

Again, this is a long extension, being over a year and is likely to allow for continued development of losses or loss estimates, before any payout determination of the underlying reinsurance or retrocession agreement can be made.

There is a good chance that both of these are aggregate reinsurance or retrocession transactions, as with so many qualifying U.S. loss events in 2017 (the hurricanes and wildfires mainly), it can take a significant amount of time for losses and industry loss estimates to be finalised.

With the fate of these private cat bonds still unknown, we have them both listed on our page detailing catastrophe bond defaults and potential payouts.

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