Marco Capital acquires Kelvin Re, now its second former-Credit Suisse ILS reinsurer

European property and casualty (P&C) run-off specialist company Marco Capital Holdings Limited has now acquired the second former Credit Suisse ILS run Guernsey based reinsurance company Kelvin Re Limited.

Marco Capital has acquired Humboldt Re Ltd., one of the two Guernsey based, Credit Suisse Insurance-Linked Strategies supported rated reinsurance carriers, back in October 2021.

That sale allowed any remaining capital to be unlocked and flow to the benefit of investors backing the funds or positions that underpinned Humboldt Re.

Humboldt Re and Kelvin Re, both rated reinsurers operated by Credit Suisse’s ILS unit, were closed down due to strategic decisions taken by the ultimate institutional investors behind them.

Humboldt Re and Kelvin Re both took their financial support from insurance-linked securities (ILS) investors and funds under the management of Credit Suisse Asset Management’s specialist ILS investment unit.

Humboldt Re was backed by capital from some of the insurance-linked securities (ILS) funds managed by Credit Suisse Asset Management (CSAM), while Kelvin Re was solely backed by investments made by the Abu Dhabi Investment Council, a sovereign wealth investor.

Kelvin Re was acquired by New York headquartered financial services group Cowen in 2022.

Cowen Inc. was then acquired by The Toronto-Dominion Bank (TD Bank), and as we reported it was not expected to form a part of its new owner TD Bank’s long-term plans, making a sale likely.

Now, Marco Capital has announced the acquisition of Kelvin Re Limited and interestingly the run-off specialist used the previously acquired Humboldt Re as the vehicle to buy Kelvin Re.

Marco Capital noted that, because both Kelvin and Humboldt were established under the stewardship of Credit Suisse’s ILS team, on behalf of third party investors, “there is substantial similarity in the books of business.”

Simon Minshall, Marco CEO, stated, “From Marco’s perspective, this transaction makes absolute sense as it encompasses a portfolio most of which overlaps with Humboldt Re, our existing Guernsey carrier, with consequential reduced risk for Marco due to familiarity as well as economies deriving from ownership of two highly similar entities.”

So, now both of the rated Guernsey based reinsurance companies that Credit Suisse had established under its ILS units oversight have ended up with a run-off specialist.

Marco Capital will now be well-positioned to run-off their remaining risks as a single portfolio, while realising any efficiencies from the coming together of the risks they each contained.