NC Farm Bureau looks to upsize Blue Ridge Re cat bond to $400m
The North Carolina Farm Bureau has now upsized its target for named storm reinsurance protection from the capital markets via its debut Blue Ridge Re Ltd. (Series 2023-1) cat bond issuance, with the deal now being offered at a suggested $400 million, evenly split across the two tranches on offer.
At the same time, we understand that the price for each tranche looks set to be finalised within the initial guidance, although potentially towards the upper-halves of the ranges that were on offer.
With this Blue Ridge Re catastrophe bond, the non-profit farm organisation and insurer is seeking reinsurance against named storm losses in its state of North Carolina.
At launch, this offering was seeking to secure $250 million of named storm reinsurance for the NC Farm Bureau, on an indemnity trigger and per-occurrence basis, across three full calendar years from January 1st 2024.
We’re now told the target size has been updated to $400 million, so a significant increase in the reinsurance being sought through this cat bond deal.
Both of the tranches of notes on offer were originally targeted to be $125 million in size, but are now $200 million each, we understand.
The Series 2023-1 Class A tranche of notes are lower risk, having an initial expected loss of 0.98% and were first offered with price guidance of a 5% to 5.5% spread. We now understand this has been updated to 5.25% to 5.5%, so look set to complete in the upper-half of guidance.
The Class B tranche of notes have an initial expected loss of 1.91% and were originally offered with price guidance ranging from a 7.5% to 8% spread. We’re now told this tranche has a spread fixed at the top-end of 8%.
So, another first-time catastrophe bond sponsor looks set to secure more reinsurance than it was originally anticipating, with that reinsurance priced within its initial expectations, so a good result for the NC Farm Bureau.
You can read all about this new Blue Ridge Re Ltd. (Series 2023-1) catastrophe bond and view details on almost every other cat bond ever issued in our extensive Artemis Deal Directory.
