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The new deal comes after the company decided not to renew its 2017 issuance last year.
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The California Earthquake Authority (CEA) has finalised pricing on its latest Ursa Re cat bond at the bottom of the range offered to investors, with the issuance reaching the top of the size range, industry sources have said. -
Hannover Re and Fidelis provided significant capacity on the Munich Re-led programme.
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The fund’s worst ILS return to date is understood to be driven by investments hit by Covid-19.
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Recent investor inflows to its cat bond UCITS have brought it to over $1bn assets under management.
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The issuer has $550mn of limit due to mature next year across two bonds.
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Spreads on the Ursa Re deal have also dropped by 7% on average during the early phase of marketing.
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Pricing dropped to the bottom of the range previously offered to investors.
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Spreads are also dropping on the bond, although they remain higher than in previous years.
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The European (re)insurance supervisor said correlation to financial market risk made the idea a challenging one while reinsurance appetite is also very limited.
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The deal is set to pay a higher coupon than most other outstanding CEA bonds, but target spreads are 18% below a similar May 2020 transaction.
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