Zenkyoren, the Japanese National Mutual Insurance Federation of Agricultural Cooperatives, has now secured the targeted $100 million in aggregate Japan earthquake reinsurance from its latest catastrophe bond, with the Nakama Re Pte. Ltd. (Series 2025-1) notes now priced near the low-end of initial guidance.
Zenkyoren buys one of the largest catastrophe reinsurance towers in the world and has been accessing the capital markets using catastrophe bonds since 2003.The mutual insurer returned to the catastrophe bond market in late March, with an initial target to secure $100 million in earthquake reinsurance from the capital markets.
As we then reported in our first update on this deal, the target size of the issuance remained the same, but the price guidance narrowed towards the lower-end of the initial range.
Now, we’ve learned from sources that Zenkyoren’s new cat bond has been priced, to secure it the targeted $100 million in fully-collateralized reinsurance protection.
This new Nakama Re 2025-1 catastrophe bond will become Zenkyoren’s fifteenth issuance to date that we have listed in our extensive Deal Directory.
Now priced, Zenkyoren has secured $100 million of Japanese earthquake reinsurance protection structured on a three-year aggregate, indemnity triggered basis, across a roughly five year term to mid-April 2030, with three annual aggregate risk periods, each three-years in length, that overlap across the full term.
The now confirmed as $100 million tranche of Series 2025-1 Class 1 notes that Nakama Re Pte. will issue come with an initial annualised attachment probability of 0.77% and an initial annualised expected loss of 0.74%.
The notes were first offered to cat bond investors with spread price guidance in a range from 2% to 2.5%, which later narrowed towards the lower-end of guidance, with the notes then offered with a tightened range of 2.1% to 2.25%.
Now, we’re told the $100 million of Nakama Re 2025-1 notes have been priced to pay investors a spread of 2.1%, so near the low-end of initial guidance.
Once again, the pricing reflects elevated investor demand for new catastrophe bond issues at this time, as well as the recent trend for strong execution of deals being seen in the marketplace.
You can read all about this Nakama Re Pte. Ltd. (Series 2025-1) catastrophe bond and every other cat bond transaction in the Artemis Deal Directory.
