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Recovered cat bond market could exceed $5bn issuance in 2010
07 January 2010
The catastrophe bond market recovered in 2009, with issuance returning to the pre-crisis levels, says Munich Re in a briefing.
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The catastrophe bond market recovered in 2009, with issuance returning to the pre-crisis levels, says Munich Re in a briefing.
Last year the volume of new bonds issued came to just under $3.5bn. The sum total exceeded the volume of expiring bonds so that overall the outstanding bonds rose to just under $12bn. Munich Re states the spread required by investors also returned to previous levels.
More than four-fifths of the volume issued covered windstorm and earthquake risks in the US.
This week Risk Management Solutions (RMS) reported that the fourth quarter of 2009 in particular had been the most active fourth quarter ever for catastrophe bond issuance. “In the fourth quarter there was a pent up demand for cat bond cover that was waiting for the market to recover,” Peter Nakada, managing director of RiskMarkets, told Reactions.
“Following...
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