Avondale Securities removed from CreditWatch by S&P


Ratings agency Standard & Poor’s have removed the ratings of two tranches of life insurance-linked notes issued by Avondale Securities SA. from CreditWatch as a correction to an administrative error. The notes issued by Avondale Securities were designed to transfer a block of life insurance risk to the capital markets through securitisation to allow the Bank of Ireland to capitalise the expected value in force of a block of life insurance policies.

The two tranches had been downgraded and placed on CreditWatch by S&P back in February because of the close link to the Bank of Ireland’s rating. The Bank of Ireland had been downgraded due to the economic situation in Ireland which had worsened earlier this year. Then in July S&P removed the Bank of Ireland’s ratings from CreditWatch, but didn’t revisit the Avondale Securities ratings at the same time.

S&P said; “The ratings on the class A-1 and A-2 notes are weak-linked to the rating on BOI due to the support agreement obligating BOI to meet, under certain conditions, payments due on the notes, and potential tax liabilities, as well as BOI’s servicing of the policies.”

So the announcement yesterday was to rectify the CreditWatch status on the notes while leaving both tranches rated at ‘BB+’ and reflects an increased confidence in the Bank of Ireland’s ability to honour any due payments.

Read our previous coverage on Avondale Securities.

Artemis Live - ILS and reinsurance video interviews and podcastView all of our Artemis Live video interviews and subscribe to our podcast.

All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.

Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.

Read previous post:
Mariah Re Ltd. Series 2010-1 served event notice, suspected triggered

Ratings agency Standard & Poor's has announced that the Mariah Re Ltd. Series 2010-1 catastrophe bond is suspected to have...