Mike Sapnar, the outgoing CEO of global reinsurance group TransRe, is heading for a new role at Stone Ridge Asset Management, the New York based asset manager with a focus on alternative risk premia strategies, according to sources and reports.
First reported by two publishers overnight and now discussed by our sources as well as analysts this morning, TransRe CEO Sapnar is said to be taking on a role of some seniority at Stone Ridge, as its development of reinsurance and ILS among its alternative risk premia strategies continues.
Having led TransRe’s development as its CEO since 2012 and built the company into a leading global reinsurance unit, under parent company Alleghany Corporation, Sapnar has both expertise and contacts that would be extremely valuable in Stone Ridge Asset Management’s leadership as it continues to build out its reinsurance investment platform.
We understand Stone Ridge is both continuing to offer its reinsurance and ILS investment strategies, as well as working with some companies in the sector to manage a portion of their assets in the niche classes it specialises in.
Stone Ridge’s mutual insurance-linked securities (ILS) fund strategies had suffered impacts from the catastrophe loss activity of recent years and have been recovering since.
Being heavily invested in private quota shares, reinsurance sidecars and other bilateral collateralized reinsurance deals Stone Ridge’s mutual ILS funds took their share of losses from the 2017 hurricanes, 2018 global catastrophe events including typhoons and wildfires, while we understand also experiencing some attritional impacts due to exposure to potential COVID-19 BI losses.
At the latest count, Stone Ridge had some $3.82 billion of ILS assets across the two mutual fund strategies
But at the same time as experiencing some shrinking of the interval ILS strategy, Stone Ridge’s mutual ILS funds have expanded their catastrophe bond holdings, which has been ongoing while the investment manager had also raised around $1.5 billion for deployment into private quota shares, including non-catastrophe risks.
Stone Ridge began allocating investor capital to non-catastrophe reinsurance risks in 2020, which may be part of the strategy at the managers Longtail Re Bermuda and Cayman reinsurance platform.
Part of these changes at Stone Ridge have involved a repositioning of the main mutual ILS fund strategies over the last year, with more of a focus on private ILS funds and mandates, we understand.
Sapnar’s joining Stone Ridge would be the most high-profile hire from the reinsurance sector so far for the investment manager and perhaps hints at how important the reinsurance platform at Stone Ridge has become, as well as the fact the manager is said to have big plans to continue building out the strategy and platform, as we understand both in offering ILS opportunities as well as in offering other alternative solutions to the insurance and reinsurance sector.
Sapnar is being replaced at TransRe by the to be promoted Ken Brandt, who will become the reinsurance firm’s President and Chief Executive Officer (CEO).