Asset manager Amundi US continued to grow its more recently launched Pioneer Cat Bond Fund strategy in the last quarter of record, with catastrophe bonds seemingly remaining the easiest strategy to raise money for, as its more reinsurance focused Pioneer ILS Interval Fund shrank a little further, albeit at a much slower rate than before.
Amundi US launched its first dedicated cat bond mutual fund earlier this year, the Pioneer CAT Bond Fund strategy.
The investment managers’ longer-standing Pioneer ILS Interval Fund, which allocates capital to quota share reinsurance arrangements, reinsurance sidecars and private collateralized reinsurance in the main, has continued to struggle through 2023.
But, in the last quarter to July 31st, the assets under management (AUM) of the ILS Interval Fund were far more stable, with the shrinking slowing considerably.
Starting with the more private reinsurance investment focused Amundi Pioneer ILS Interval Fund, this strategy had reported $860 million in total net assets at July 31st 2022, but that shrank to $807 million by the end of October 2022, then again to $752 million by the end of January 2023 and most recently, by the end of April 2023, the Interval ILS Fund’s AUM had shrunk again to just over $698 million.
Now, at July 31st 2023, the Pioneer ILS Interval Fund reported total net assets of approximately $684.54 million, so only a slight decline during the last quarter of record.
Encouragingly, this might signal that catastrophe losses are increasingly being realised, with the portfolio turning over, plus some new capital raised, it appears. So the Interval ILS Fund may now be on better footing going forward, and importantly the total net assets of the fund are now above the costs of its investments, only slightly but this has crept up from a shortfall in quarters past.
Moving on to the newer Pioneer Cat Bond Fund, this strategy has continued to grow in the last quarter, which is reflective of ILS investor appetites in 2023 and better conditions for raising capital for cat bond fund strategies.
The Pioneer CAT Bond Fund counted $16.6 million in assets under management (AUM) at January 31st 2023, which subsequently grew in the next quarter to just over $27.5 million by the end of April.
Now, at July 31st, the Pioneer CAT Bond Fund reports its total net assets as having reached just slightly under $76 million.
It’s likely that growth will continue over the next few months, as the catastrophe bond issuance pipeline opens up again.