Recoletos Re DAC (Series 2026-1)

This is the third Recoletos Re DAC catastrophe bond sponsorship from Spanish headquartered global reinsurance company Mapfre Re, with the company looking to secure additional capital markets backed US named storm protection to complement its group protection.

As with its first two cat bonds, Mapfre Re is again using its Ireland-based issuance vehicle Recoletos Re DAC for its third catastrophe bond sponsorship.

Recoletos Re DAC is targeting issuance of a single tranche of Series 2026-1 Class A notes, that will be sold to cat bond investors and the proceeds be used to collateralize a retrocession agreement between the issuing vehicle and Mapfre Re.

That retrocessional agreement will provide US named storm reinsurance protection for all states except Florida on an indemnity trigger and per-occurrence basis to the sponsor, over a roughly three year term to the end of June 2029, we understand.

The coverage will also cascade via Mapfre Re, in order to extend it to other group entities including certain insurer subsidiaries, we are told.

The currently $200 million of Series 2026-1 Class A notes being offered by Recoletos Re DAC will have an attachment point at $150 million of losses and exhaust their coverage at $350 million, sources said. There may be other reinsurance layers that inure to the coverage, we cannot be sure.

The Class A notes come with an initial attachment probability of 2.57%, an initial base expected loss of 1.836% and are being offered to investors with spread price guidance in a range from 4.25% to 4.75%.