Peak Re secures second Black Kite Re catastrophe bond at targeted $50m size

Peak Re has now successfully priced its second catastrophe bond with the Black Kite Re Limited (Series 2025-1) issuance set to provide the targeted $50 million of retrocession across Japanese typhoon and earthquake risks on an industry-loss basis, as well as China and India earthquakes using a parametric trigger.

The Hong Kong headquartered global reinsurance company returned to the catastrophe bond market earlier this month, aiming to secure $50 million or more in retrocessional reinsurance from this Black Kite Re 2025-1 deal.

Now, we’re told the targeted $50 million size has been achieved, while the pricing of the notes has been finalised at the upper-end of the initial guidance.

Peak Re’s debut catastrophe bond sponsored back in 2022 had secured the company $150 million of Japanese typhoon retrocession on an industry-loss trigger basis from the Black Kite Re Limited (Series 2022-1) deal.

That cat bond transaction is scheduled to mature this coming June, so it appears Peak Re’s cat bond backed retro will decline at that time unless any further issues come to light, given the smaller size of this second Black Kite Re cat bond deal.

But, this second Black Kite Re cat bond, which is being issued out of Hong Kong, has expanded the coverage for Peak Re, with the inclusion of parametric reinsurance protection against earthquakes in China and India.

Now priced, the confirmed as $50 million Black Kite Re 2025-1 cat bond will cover Japanese earthquake and typhoon risks on an industry loss trigger and per-occurrence basis for Peak Re, so an expansion of the Japanese protection, as well as the additional cover for Chinese and Indian earthquake risks on a parametric basis, all across a three-year period from issuance in late April.

The $50 million of Black Kite Re 2025-1 Class A notes come with a combined initial expected loss of 3.78% and were initially offered to cat bond investors with spread price guidance in a range from 7.25% to 8%.

We’re now told the $50 million of notes have been priced to pay investors a spread of 8%, so at the upper-end of the initial guidance.

It’s good to see Peak Re expanding the universe of covered perils in the catastrophe bond market with its second Black Kite Re transaction including rarely seen parametric earthquake risk in China and the never seen before parametric earthquake risk in India.

You can read all about this Black Kite Re Limited (Series 2025-1) catastrophe bond from Peak Re, as well as every other cat bond transaction in our extensive Artemis Deal Directory.