Genworth & Radian secure $740m of mortgage ILS cover


Mortgage insurers Genworth Mortgage Insurance, a subsidiary of Genworth Financial, and Radian Guaranty, part of the Radian Group, have both closed new mortgage insurance-linked securities (ILS) issuances in the last week, successfully securing $740 million of capital markets backed, collateralized mortgage reinsurance between them.

Mortgage riskBoth transactions settled at the sizes previously announced, with Genworth’s $350 million Triangle Re 2020-1 Ltd. mortgage ILS deal and Radian Guaranty’s $390.3 million Eagle Re 2020-2 Ltd. transaction just the latest two of a flurry of mortgage ILS activity.

Issuance of mortgage insurance-linked notes to-date in 2020 sits at almost $3.2 billion settled, but almost $3.43 billion including another transaction which is closing soon. All are detailed in the Artemis Deal Directory.

Genworth Mortgage Insurance Corporation secured $349.6 million of fully collateralized excess of loss reinsurance coverage from Triangle Re 2020-1 Ltd.

The ILS deal provides reinsurance for a portfolio of existing mortgage insurance policies underwritten from January 2020 through August 2020.

Triangle Re funded its reinsurance obligations through the issuance and sale of five classes of mortgage insurance-linked notes (ILNs) to qualified institutional investors in an unregistered private offering. The notes have a 10-year legal final maturity with a 7-year call option.

For Genworth, this Triangle Re ILS deal is its second ILN issuance since the COVID-19 pandemic began.

“I’m proud of the work we continue to do to strengthen our portfolio and balance sheet,” commented Genworth MI’s Chief Executive Officer Rohit Gupta. “In the best of times, these actions help us effectively manage our capital—and in uncertain times, they help us weather the impact of market volatility on our portfolio and protect our balance sheet.”

Read more about the Triangle Re 2020-1 Ltd. deal.

Radian Guaranty, meanwhile, secured $390 million of fully collateralized excess of loss reinsurance coverage from Eagle Re 2020-2 Ltd.

This transaction provides capital markets backed excess of loss reinsurance covering eligible mortgage insurance policies underwritten by Radian Guaranty from October 2019 through July 2020, excluding single premium payment policies.

Radian’s reinsurance obligations are funded through the issuance and sale of five classes of mortgage insurance-linked notes (ILNs) with a 10-year maturity and 7-year call option to eligible third-party capital markets investors in an unregistered private offering.

Read more about the Eagle Re 2020-2 Ltd. mortgage ILS transaction.

Find information on every mortgage insurance-linked securities (ILS) transaction in our Deal Directory.

Artemis London 2022 - Insurance-linked securities conference in LondonTickets are selling fast for Artemis London 2022, our first ILS conference in London. Sept 6th, 2022.

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