Hamilton prices $200m Easton Re cat bond 11% below guidance mid-point

Hamilton, the Bermuda based insurance and reinsurance holding company, has now successfully priced its new catastrophe bond issuance to provide the upsized target of $200 million in collateralized multi-peril retrocessional reinsurance, while the Easton Re Ltd. (Series 2024-1) cat bond notes were finalised to pay a below-guidance spread.

It’s a strong result for Hamilton in what is only its second sponsorship of a catastrophe bond, delivering more than the initially targeted retro reinsurance protection at pricing that was finalised below initial expectations.

Hamilton Insurance Group returned to the catastrophe bond market at the end of November, with a $150 million target for this Easton Re 2024-1 cat bond.

That would have completely replace its soon to mature $150 million Easton Re Pte. Ltd. cat bond.

The target size was then increased, as we reported, with the notes offered as a $200 million tranche while at the same time the price guidance was lowered to a new range below the initial one.

Now, Artemis has learned that the Easton Re 2023-1 catastrophe bond will be completed at that upsized target of $200 million.

Meaning that, Hamilton will now enter 2024 with a $200 million source of retrocessional coverage against losses from U.S., DC, Puerto Rico, and Virgin Islands named storms, as well as U.S. and Canada earthquakes, on an industry loss trigger and per-occurrence basis, over a three year term, through calendar years 2024 to 2026, from this cat bond.

The now confirmed as $200 million of Class A notes have an initial expected loss of 2.65% and were first offered to cat bond investors with spread price guidance in a range from 8% to 8.75%.

That spread price guidance was subsequently lowered to between 7.5% and 8%.

We’re now told that the price was finalised at 7.5%, so the bottom-end of the lowered range and approximately 11% below the mid-point of the initial price guidance.

Which is very strong execution of this second cat bond for Hamilton, as it has secured more retrocession than originally targeted, at a far better price than had originally been forecast.

You can read all about this Easton Re Ltd. (Series 2024-1) catastrophe bond transaction in our extensive cat bond Deal Directory.