Swiss Re Capital Markets structures and places USD 175 million catastrophe bond for named storm and earthquake risks for Allianz Group
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Swiss Re Capital Markets has structured and successfully transferred USD 175 million of insurance-linked securities issued by Blue Danube II Ltd. ("Blue Danube II") on behalf of a subsidiary of Allianz SE. The securities cover named storms and earthquake losses in North America, the Caribbean and Mexico.
Swiss Re Capital Markets underwrote the transaction which covers U.S. and Canadian earthquake losses as well as named storm losses in select U.S., Caribbean and Mexican territories for three years. The bond was structured on behalf of Allianz Argos 14 GmbH, a wholly-owned subsidiary of Allianz SE. Blue Danube II is a special purpose vehicle formed in Bermuda.
Jean-Louis Monnier, Director and Head of ILS Europe at Swiss Re Capital Markets, comments: “We are very pleased to continue to support Allianz SE's access to capital markets capacity. This new transaction uses a "MITT" trigger and complements last year's Blue Danube issuance, providing Allianz SE with a multi-year cover against named storm and earthquake losses in North America, the Caribbean and Mexico."
A modeled industry trigger transaction ("MITT"), developed by Swiss Re Capital Markets, takes industry loss estimates for the U.S. and Canada and weighs them post-event based on certain applicable modeled portfolios. The transaction utilizes a putable note, issued by the International Bank of Reconstruction and Development ("IBRD") and underwritten by Swiss Re Capital Markets, as collateral.
Swiss Re acted as joint book runner and joint structuring agent.
Standard & Poor's has published a BB+ (sf) rating for the Blue Danube II notes.
The Notes have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or any state or foreign securities laws, and the Issuer is not and will not be registered under the United States Investment Company act of 1940, as amended (the "Investment Company Act"). The Series 2013-1 Notes will be offered and sold only to investors who (i) are "Qualified Institutional Buyers" within the meaning of Rule 144A under the Securities Act that, with respect to U.S. persons, are also "Qualified Purchasers" for purposes of section 3(c)(7) of the Investment Company Act, (ii) are "Qualified Eligible Purchasers" as defined in U.S. Commodity Futures Trading Commission Rule 4.7. and (iii) are residents of, and purchasing in, and will hold these notes in, a Permitted U.S. Jurisdiction or a Permitted Non-U.S. Jurisdiction. These Notes are subject to substantial restrictions on transferability and resale, and may be subject to a lack of market liquidity.
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