contingent capital facility

Reinsurance firm Swiss Re has successfully completed its novel dual-trigger contingent capital security transaction, having sold CHF175m Swiss francs of notes linked to either the occurrence of a major decline in its solvency level or a major natural catastrophe loss.

Financial market sources have told us that reinsurance firm Swiss Re is looking to secure a new source of contingent capital protection for its solvency and balance sheet with the launch and marketing of a new dual-trigger contingent capital securitized bond issuance.

Reinsurer Swiss Re’s contingent capital bond issuance came to market last month and succeeded in securing the Swiss based reinsurer a $750m source of capital protection linked to its solvency from investors. The transaction received a lot of attention in the press as it came to market and was reported to have been oversubscribed as […]

Almost two weeks ago we wrote about the rumoured contingent convertible bond issuance which Swiss Re would be sponsoring as a way to protect its balance sheet against declines in its capitalisation. Contingent capital used in this way can provide broad protection against many risks which could impact a reinsurer like Swiss Re, from large […]

Contingent capital has been back on our radar recently thanks to the market rumours suggesting that reinsurer Swiss Re has been arranging a marketing roadshow for a contingent convertible bond issuance recently. The first time we wrote about contingent capital on Artemis it was not with reference to reinsurers however, it was discussing whether contingent […]

Reinsurer Swiss Re is in the news today regarding the use of contingent capital, after a bank told reporters at Dow Jones that the reinsurer plans to arrange a series of meetings to roadshow a contingent convertible bond issuance. The bank source is said to be one of the institutions arranging the investor meetings, or […]

An initiative established under the Dodd-Frank Act by the U.S. Treasury to look at systemic risks and financial stability, the Financial Stability Oversight Council (FSOC), has just completed a study of contingent capital solutions to see if they are tools which could be leveraged to ward off financial crisis. The FSOC, which is charged with […]

French reinsurer SCOR have announced that they have extended the cover available to them through their natural catastrophe contingent capital facility which they launched back in 2010. They have elected to extend the innovative contingent capital solution, which acts as an event-driven guaranteed equity line, by an additional €75m taking the amount of cover SCOR’s […]

The Farmers Exchanges, the third largest insurer of personal auto and homeowners insurance in the U.S., has announced the renewal of a $500m contingent capital facility designed to give them access to capital in the event of major catastrophe loss. Initially launched in 2007, the contingent capital facility gives the Farmers Exchange the ability to […]

Contingent capital is an alternative form of capital or financing which can be triggered and made available under certain, specific pre-defined circumstances. It’s becoming a flexible way for companies to arrange a source of financing which is made available at precisely the times they need it. In the case of re/insurers contingent capital can come […]