SCOR lifts new Atlas cat bond upper-target to $250m as price rises
France headquartered global reinsurance company SCOR has raised the target size for its new Atlas Capital Reinsurance 2022 DAC (Series 2022-1) catastrophe bond to as much as $250 million, while the price guidance has been raised almost 12%.
SCOR is seeking a new capital markets source of aggregate international multi-peril retrocessional protection with this new cat bond deal.
At launch ten days ago, SCOR’s target for this new Atlas Capital Re 2022-1 catastrophe bond was to secure $150 million of retro reinsurance protection.
Now, sources have told us the target size has been lifted, with SCOR now aiming to secure from $200 million to as much as $250 million of catastrophe retro from the transaction.
Encouragingly, SCOR’s appetite for protection has increased even though the pricing has as well.
We understand that this will be the latest cat bond to price above its initial guidance, as the coupon guidance has been lifted by about 12% above the initial mid-point of guidance, sources said.
To recap, SCOR set up a new company in Ireland for its new catastrophe bond issuance, Atlas Capital Reinsurance 2022 DAC.
Atlas Capital Reinsurance 2022 DAC will issue a single Class tranche of Series 2022-1 notes, now sized at between $200 million and $250 million.
The cat bond will provide SCOR with a three-year source of industry loss trigger and annual aggregate based retrocession, covering losses from US named storms (including Puerto Rico and the US Virgin Islands), US earthquakes (including Puerto Rico), Canada earthquakes and also European windstorms.
The single tranche of Class A notes will have an initial attachment probability of 3.8%, an initial expected loss of 3.17% and were at first offered to cat bond investors with price guidance in a range from 8.25% to 8.75%.
As we highlighted in our previous article on this deal, that was keenly priced guidance, as SCOR’s 2020 catastrophe bond priced to offer investors a multiple-at-market of 2.9 times expected loss (EL), when this new cat bond was only offering a 2.7 times EL at the mid-point.
It’s not surprising then to learn from sources that the guidance coupon has been raised to 9.5%, representing a much healthier multiple of almost 3 times the base case EL.
You can read all about this Atlas Capital Reinsurance 2022 DAC (Series 2022-1)catastrophe bond from SCOR and every other cat bond transaction in the Artemis Deal Directory.
