Swiss Re has announced the closing of a multi-year stop-loss transaction with JP Morgan and other institutional investors.

The $1.15bn transaction is aimed at covering underwriting risks across the entire Swiss Re group for the financial year 2022-2026.

The hybrid transaction, which combines bank financing and insurance-linked securities (ILS), will use the segregated account of the existing Matterhorn Re special purpose insurer vehicle.

Of the $1.15bn, US banking major JP Morgan will provide $1bn financing via a senior loan.

Institutional investors will contribute by investing in junior insurance-linked notes issued by the segregated account.

The funding will support Swiss Re’s growth opportunities in the reinsurance market and have a positive impact on the group’s capital requirements and ratings.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

Swiss Re Group CFO John Dacey said: “The innovative partnership is a great example of how the group considers all sources of capital holistically and aims to further enhance its flexible capital structure.

“With this transaction, the Alternative Capital Partners division delivers another material contribution to Swiss Re’s efficient capital management.”

The reinsurer noted that the transaction is fully collateralised and the proceeds will be held in the form of notes issued by the European Bank for Reconstruction and Development (EBRD).

Alternative Capital Partners was launched in 2019 by merging Swiss Re’s ILS and Retro & Syndication teams.

Swiss Re Alternative Capital Partners head Philipp Rüede said: “Through Alternative Capital Partners’ expertise and strong relationships, we have been able to structure this first-of-its-kind hybrid transaction, bringing together bank financing and insurance-linked securities markets. In doing so, we have leveraged the complementary nature of the two sources of capital in a landmark transaction within the reinsurance and ILS markets.”

Earlier this year, Swiss Re Insurance-Linked Investment Management raised $250m from Sweden-based Alecta.