Resilience Re Ltd. (Series 1642B)

This $85m Series 1642B tranche of notes is the second listed private catastrophe bond transaction from Willis Capital Markets & Advisory’s Resilience Re Ltd. issuance platform.

This is the second transaction from the platform that we have received some information on, we cannot be certain whether it has been used for other deals as well. Back in January the California Earthquake Authority (CEA) used the platform to transform a collateralised reinsurance signing on its renewal, with the $57m Resilience Re Ltd. (Series 15121A).

Now a larger, second transaction has come to light, with the listing of an $85m Resilience Re Ltd. (Series 1642B) tranche of notes on the Bermuda Stock Exchange (BSX).

The $85m of notes issued by Resilience Re Ltd. are discounted zero coupon participating notes, which suggests that again this is the transformation of a collateralised reinsurance deal with the coupon having been paid as premium and the notes created to provide an investor (or investors) with liquid securitised access to the underwritten risk.

The $85m of notes have a due date of April 7th 2017, so represent a single annual reinsurance contract, it would seem. It’s safe to assume that these notes are exposed to property catastrophe reinsurance risks, but of what type we do not currently know.

It is highly likely that this transaction is designed to cover an April reinsurance renewal cedent. It is possible that this latest Resilience Re private cat bond is for the CEA’s reinsurance program, as the organisation had another renewal due at the start of April, however we cannot confirm that at this stage.

With the listing on the BSX, the investors in this $85m Resilience Re Ltd. (Series 1642B) private catastrophe bond will benefit from enhanced secondary liquidity in the notes.

As this transaction was issued through the Resilience Re platform Willis Capital Markets & Advisory will have played the joint roles of structuring agent and bookrunner for this private cat bond deal.

Update: This Resilience Re private cat bond features risk sourced from the California Earthquake Authority (CEA) and was transacted as a way for investors to participate in its reinsurance renewal on a liquid, securitised basis.