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GC Securities: Catastrophe Bond Issuance Tops $1.3 Billion in Q1 2012

Posted on 18 May 2012 by Neilson

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The first quarter of 2012 was the most active first quarter on record for the global catastrophe bond market, according to GC Securities, a division of MMC Securities Corp., a U.S. registered broker-dealer and member FINRA/SIPC. During the quarter, a total of $1.34 billion of risk capital was issued through eight transactions, exceeding last year’s record of $1.02 billion for the same time period.

In Q1 2012, GC Securities also found that:

Total risk capital outstanding increased by 5.2 percent from $12.14 billion to $12.77 billion.

Catastrophe bond redemptions amounted to the equivalent of $711.3 million of risk capital.

Issuance was significantly more diverse than the year before, particularly in terms of types of exposure, event structure and risk/return profile.

For a detailed analysis of Q1 2012 results for the global catastrophe bond market, please see Cat Bond Update: First Quarter 2012 at

Cory Anger, Global Head of ILS Structuring, GC Securities: “In the first quarter of this year, sponsors sought to lock in capital markets capacity for a diverse array of perils and structures in a somewhat uncertain traditional market environment. Capital providers proved up to the task, although with some upward pressure on pricing.”

Chi Hum, Global Head of ILS Distribution, GC Securities: “The level of issuance achieved in the first quarter demonstrates that both protection sellers and buyers are seeing strong value in the insurance-linked securities market. Record issuance combined with new perils, structures and investors illustrate the continued growth and maturity of the catastrophe risk asset class.”