Peak Re doubles inaugural Hong-Kong cat bond on heavy investor demand

Reinsurer  Peak Re closed issuance of a $150 million 144A catastrophe bond at double the initially guided size and will back the security with a retrocession arrangement with the unit tasked with issuance for multi-year protection against typhoon risk in Japan.

The deal, what  Peak Re terms the first 144A catastrophe bond issued from Hong Kong, was run via newly established Hong-Kong based issuance vehicle Black Kite Re. The transaction is also expected to be the first to utilize the Pilot Insurance-linked Securities Grant Scheme introduced by the Government of Hong Kong last year.

Peak Re CEO Franz Josef Hahn (pictured) commented: “We are pleased to see that the transaction was able to attract significant investor interest, allowing for a 100% upsize from the initial announced transaction size.  Through continued partnership with global insurance-linked securities (“ILS”) investors,  Peak Re can play an important role in developing the ILS market and building resilience in Asia and beyond.”

Peak Re's head of global retrocession Sascha Bruns added: “ILS has become an integral part of our retrocession strategy and has provided meaningful capacity to support the Company’s strong business growth. The successful transaction demonstrates  Peak Re's ability to structure products that are both attractive to the capital markets and serving us well as a risk management tool.”

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