Oak Global, the specialist Lloyd’s underwriting company, has successfully priced its debut catastrophe bond sponsorship, securing a 100% upsized $150 million of retrocessional protection from the capital markets from its Arthur Re Ltd. – Quercian Re 2026-1 cat bond issuance, while the notes priced below initial guidance, Artemis has learned.
Initially, Arthur Re Ltd., the Bermuda domiciled unrestricted special purpose insurer (SPI) that’s managed by Artex, was offering a $75 million tranche of notes on behalf of its segregated account named Quercian Re 2026-1.
In our first update on this transaction, we learned that the target size had been raised to between $125 million and as much as $150 million, while at the same time, the price guidance of the notes on offer were also adjusted to a tighter and lower range of spreads.
Now, we’re told the notes have been priced at $150 million, and so Oak Global has successfully secured the 100% upsized amount of cat bond protection, with pricing finalised below the initial guidance range.
The now priced $150 million Quercian Re 2026-1 notes that Arthur Re Ltd. will issue are set to provide a source of fully-collateralized, multi-year and multi-peril retrocessional protection from the capital markets to Syndicate 2843, which is acting through its managing agent Polo Managing Agency.
The covered perils and regions for this cat bond are losses from US and Canada named storms and earthquakes, as well as US wildfire events, structured on an annual aggregate and industry loss trigger basis, with that coverage to run across a three year term to the end of May 2029.
The now confirmed $150 million of Quercian Re 2026-1 cat bond notes will feature a $15 million franchise deductible, while their attachment point is at $240 million of aggregate losses. Which gives these notes an initial attachment probability of 4.6%, and an initial expected loss of 3.29%.
These notes were initially offered to cat bond investors with price guidance for a spread of between 7.25% and 8%, which was later updated to a tighter, lower spread range of 7% to 7.5%.
We’re now told the notes priced to pay investors an initial risk interest spread of 7%, so below the initial guidance range.
All of which indicates a very strong result for a first-time catastrophe bond sponsor and Oak Global will unquestionably be delighted with the reception the investor base gave towards its first cat bond offering.
As a reminder, you can read all about this new Arthur Re Ltd. – Quercian Re 2026-1 catastrophe bond and every other cat bond transaction in the Artemis Deal Directory.
