November 2011/1

The CEO and CFO of insurance services provider Kane Group have left the firm just months after its acquisition of HSBC Insurance Management, Trading Risk can reveal.

The remaining $100mn tranche of tornado cat bond Mariah Re is set to be a total loss in what would be the third wipeout of a cat bond this year, Trading Risk has learned.

Deutsche Bank has closed a longevity swap with the trustees of the Rolls-Royce pension fund in one of the largest such deals to date.

Start-up ILS operation Dunamis Holdings is the latest to back private cat bonds with the launch of a new "one-stop" issuance facility to transform risk into the capital markets.

Chartis subsidiary National Union Fire Insurance Company (NUFI) has more than doubled its Compass Re cat bond from a $275mn target to close at $575mn, Trading Risk understands.

Clariden Leu ILS fund manager Michael Stahel says it is business as usual despite the announcement yesterday (15 November) that the Swiss private bank will be integrated into parent bank Credit Suisse

Trading Risk previously reported that North Carolina-based hedge fund Petra Haven, led by Brad Chance, had seeded Bermudian ILS fund manager Dunamis with a single-digit million-dollar amount.

Collateralised Bermudian reinsurer Q Re is set to close as billionaire backer George Soros steps away from the sector.

Competitive and economic constraints have pushed the minimum entry size for an ILS fund to $100mn, according to fund services provider Horseshoe.

Listed fund manager Catco Reinsurance Opportunities Fund says it is considering reserving for a loss from the New Zealand earthquake to "resolve ambiguity" ahead of the January 1 renewals.

Investment manager GAM has launched a new pure cat bond fund with seed capital from a group of external investors as part of its line-up of funds managed by leading ILS player Fermat Capital Management.

The ILS market's risk appetite has proved "remarkably stable" amid a highly volatile year, Lane Financial partner Morton Lane wrote in a recent report.

A panel of (re)insurance industry executives advised reinsurance buyers to limit exposure to capital market capacity, questioning the long-term commitment of some investors in the sector.

Nephila Capital co-founder Frank Majors encouraged a Baden-Baden reinsurance audience to embrace the convergence sector and said it offered an opportunity for all in the market.

There was a lot of lively debate to match the blustery October weather at this year's Trading Risk New York conference, but a speech from Catlin retro buyer Mark van Zanden sparked one interesting exchange with Fermat Capital founder John Seo over whether ILS investors are asking too much to take on catastrophe risk.

Cat bond premiums are far higher than they should be when analysed using investment theory models that predict low risk, diversifying assets such as ILS should earn correspondingly low returns...

ILS fund structures are coming under strain as managers direct more of their portfolios into illiquid collateralised reinsurance instruments, Albourne Partners analyst and ILS investment adviser Michael Hamer said at the Trading Risk New York conference.

Parametric insurance will make it easier for public organisations to buy insurance against catastrophes, according to Cooper Gay's Latin America CEO Steve Jackson

Trading platform ICE is continuing to list seven Ifex event-linked futures contracts after de-listing a group of the products earlier this year

Swiss Re Capital Markets hopes to attract more institutional investors to back industry loss warranty (ILW) capacity as it mulls setting up a platform to transform the derivative contracts into bond format

Aggregate industry loss warranty (ILW) covers have grown in popularity this year but there are questions over how much supply will be in the market next year

Industry loss warranty (ILW) prices have begun to drop back over the past few months from the elevated levels that had lasted ever since the Great Tohoku earthquake in March, according to brokers

Goldman Sachs subsidiaries Rothesay Life and Paternoster have bought a record £450mn of longevity cover from New Jersey-based Prudential Retirement in the largest longevity reinsurance deal for the firm to date

A US subsidiary of Prudential Financial has closed a $2bn letter of credit deal with a number of banks in the largest life securitisation since the 2008 financial crisis

Ratings agency Fitch has placed the Signum 2010 excess mortality securitisation on negative watch in line with its status on the notes' guarantor Goldman Sachs

The California Earthquake Authority (CEA) plans to add to its Embarcadero Re cat bond issuance programme with a $300mn transaction in January next year

Leading ILS fund manager Nephila has more than tripled its line on the California Earthquake Authority (CEA)'s 2012 reinsurance programme, according to board meeting papers from the authority

Bermudian reinsurer PartnerRe's ILS losses have reached $54mn for the first nine months of 2011, making up just under 4 percent of its $1.403bn catastrophe loss total for the period

The Validus sidecar AlphaCatRe 2011 wrote $18.8mn of gross premiums during the third quarter, taking its total premiums written to $61.4mn since its start-up in June

Scor used just a quarter of its retro protection in the first nine months of the year, but still ceded EUR297mn of cat claims to its retrocessionaires during the period

David Einhorn's Greenlight Capital Re reported a $4.5mn net loss for the third quarter, compared to a $29mn net profit for the same period of 2010, as a steep fall in investment income dragged on the results

Private cat bond deals are likely to continue, but they do not always save costs for their issuers, broker Willis Capital Markets and Advisory said in a recent report on the ILS market

Traders at Execution Noble will hold their tenth annual charity day on 17 November, raising money for local charities in their London home

ILS funds and traders must create their own transparency in the cat bond market by actively working with broker-dealers to get a sense of the market price, according to Elementum Advisors founding partner John DeCaro

Prices in the secondary trading market are being depressed by a flurry of keenly priced new cat bonds in the fourth quarter and an element of seasonality as the US wind season closes

Pricing on American Family Mutual's Mariah Re 2010-1 cat bond increased slightly on news that the notes were to suffer an $11.6mn loss