Aspen Capital Markets grows AuM to $1bn. H1 fee income beats prior year

Aspen Capital Markets, the third-party reinsurance capital management unit of global re/insurer Aspen, has further increased its third-party capital and insurance-linked securities (ILS) assets under management to roughly $1 billion by the middle of 2022.

Reporting its half-year results today, Aspen Insurance Holdings Limited, the Bermuda headquartered insurance and reinsurance company, revealed continued expansion of its third-party capital and ILS operations, as well as increasing fee income from the Aspen Capital Markets unit.

For the first six months of 2022, Aspen Capital Markets has generated $47 million of fee income, up from $30.5 million in the six months ended June 30th 2021.

That follows on the heels of robust growth in third-party capital fee income in 2021, when the total had roughly doubled over 2020, to reach $61.4 million.

The first-half figure for H1 2022, shows that Aspen is well on the way to eclipsing that annual fee income again.

Helping to increase this has been the increased assets under management at Aspen Capital Markets.

The AuM figure had reached almost $918 million by the end of 2021, but grew another roughly 2% by the middle of 2022, at around $1 billion of capital managed.

The way Aspen accounts for its capital market fee income helps to improve the performance of individual business lines, as the re/insurers cedes a wide-range of exposures to third-party investors from across its book.

“Aspen Capital Markets’ activities is primarily allocated to the line of business being ceded and serves to reduce acquisition expenses for that business,” the company explained.

Mark Cloutier, Group Executive Chairman and Chief Executive Officer, commented on the growing capital markets activity.

“Aspen Capital Partners, our capital markets franchise, is the third important pillar of our business, and we were pleased to report total fee income of $47.0 million for the six months ended June 30, 2022, an increase of $16.5 million over the prior year.

“Our capital markets franchise has continued to grow and now represents approximately $1 billion of AUM. Our ability to grow and diversify the capital we manage, notwithstanding a challenging environment, supports our core proposition that capital markets investors are key partners in Aspen’s future growth and innovation efforts,” he explained.

The company further explained in its results statement that, “Our continued ability to grow the capital we manage underpins our view that capital markets business and investors are key partners in Aspen’s further growth and innovation efforts.”

Aspen Capital Markets specialises in constructing tailor-made portfolios of reinsurance for investors through managed insurance-linked securities (ILS) funds, as well as quota share sidecar structures that utilise its Peregrine Re vehicle.

The third-party capital focused unit continues to expand its activities in specialty and casualty lines as well, bringing an increasing wide range of risks to investors.

Aspen Capital Markets is one of the dedicated insurance-linked securities (ILS) fund managers and reinsurers offering ILS-style investment opportunities listed in our Insurance-Linked Securities Investment Managers & Funds Directory.