April 2011/1

The cat bond market shrank in the first quarter of 2011 and uncertainty over traditional reinsurance rates may stall the sales pipeline for the rest of the year, according to GC Securities.

Ratings agency AM Best has placed $175mn of Flagstone Re's 2009 Montana Re cat bond under review for a downgrade as it absorbs the revised risk profile of the notes following RMS' version 11 US wind model.

A combination of high volumes of cat bond maturities and a lack of anticipated new issuance in Q2 2011 will depress pricing as investor capital supply outstrips demand, Aon Benfield Securities (ABS) predicts.

The North Carolina state wind pools are offering a further $200mn of single-state US wind risk to the capital markets via its Johnston Re shelf facility.

Ratings agency Standard & Poor's (S&P) has put 17 catastrophe bonds on CreditWatch with negative implications over concerns that the new RMS hurricane model would materially change their profile.

Well-known convergence executive Des Potter has left Aon Benfield Securities, Trading Risk can reveal.

Investment bank Deutsche Bank has signed up Michael Halsband as a director in the firm's capital markets and treasury solutions group after his departure from Goldman Sachs.

Alterra Capital will take a $60-100mn net loss on the 11 March Japanese earthquake and it may also see an investment loss of up to $25mn on a cat bond it owns that is exposed to the event.

Baldwin ILS fund first to report March loss; Catco goes back to investors for $7mn;Securis holds on listed fund; GAM markets Fermat fund

Bermuda-based retro and industry loss warranty (ILW) fund Aeolus is raising additional capital to deploy ahead of the US wind season, while its corporate restructure is on track to complete later this year, according to sources.

Bermudian reinsurer Flagstone heads the Q1 loss table from sister publication The Insurance Insider, confirming warnings from ratings agency Moody's that the company was experiencing outsized losses from the string of natural disasters so far this year.

Despite a wave of punishing catastrophe losses in the first quarter, only a handful of reinsurers are in the market for retrocession protection, making for a tense game of "chicken" before the US wind season.

The ‘C' in P&C insurance has to date been a closed market for the ILS world, but P&C insurance information provider ISO hopes that a new casualty index may open up new possibilities for risk transfer to the capital markets.

Johnson breaks with Tradition; $10mn IFEX hurricane trade; WRMA heads to Oz

Insurance entrepreneur Neil Eckert is enacting a management buy-out of the catastrophe derivative trading platform IFEX, Trading Risk understands.

Quake products are leading the rise in industry loss warranty (ILW) prices, with California prices up by two thirds in the wake of the catastrophic 11 March Japanese earthquake, Trading Risk understands.

FSA blocks triple-X loophole; BNPP in EV deal; Pension funds may offload up to £20bn of risk

Bankers and reinsurers are confident they won't lose out from the precedent set by London-listed insurer Legal & General, which bypassed other suppliers to complete a transfer of triple-X redundant reserve reinsurance earlier this year.

Firms seeking reinsurance solutions for their triple-X and A-XXX redundant reserves are pushing for better pricing and longer-dated deals, as the number of bankers chasing their business rises.

Casualty index launched; K6's quake knock; Crystal Credit redeemed; Aspen's collateral protection

Hedge fund-backed reinsurer Greenlight Re reported a 57 percent year-on-year drop in net income to $90.6mn for 2010.

Risk and insurance management specialist Kane Group has purchased leading cat bond administrator HSBC Insurance Management (HIM) in a private equity-backed deal worth $27.5mn.

The California Earthquake Authority (CEA) is working to source $150mn of cat bond capacity from the capital markets after a 15-month hiatus from the ILS sector.

US coast faces greater hurricane threat; Guy Carp gains CCRIF account; Quakes make 2010 7th costliest cat year; Industry Euro wind exposure up 5%: Perils