Hong Kong’s Insurance Authority (IA) has welcomed the recent issuance of the latest catastrophe bond sponsored by Peak Re, the US $50 million transaction, while also noting that the deal represents a sign of the maturity under its insurance-linked securities (ILS) regulatory regime.As we’ve been reporting, Peak Re secured a three-year source of retrocessional reinsurance protection through its Black Kite Re 2025-1 cat bond.The Black Kite Re cat bond notes provide Peak Re with protection for losses from Japanese earthquake and typhoon risks on an industry loss trigger and per-occurrence basis, 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.In addition, the Black Kite Re 2025-1 cat bond deal represents the first time that a Hong Kong Special Purpose Insurer (SPI) has been reused for a second issuance, which further highlights the scalability and maturity of Hong Kong’s ILS framework.

Readers may recall that Peak Re’s $150 million issuance was the first 144A cat bond issued out of Hong Kong.An Insurance Authority of Hong Kong spokesperson stated: “The decision by Peak Re to issue a second catastrophe bond in Hong Kong making use of the same infrastructure bears testimony to our growing competitiveness and maturity as an insurance-linked securities (ILS) hub.“It is particularly encouraging to see that this transaction aims at tackling a wider range of natural perils, showcasing the tremendous potential of ILS in narrowing protection gaps in the Asia region.” Since launching its ILS regulatory regime, Hong Kong has seen almost US $800 million in issuance either issued using a Hong Kong structure, or listing on its exchange.

Almost US $300 million of that has actually used a Hong Kong domiciled and regulated special purpose reinsurance vehicle (SPRV) structure for issuance, while the remaining $500 million came from two World Bank cat bonds that listed their notes on the Hong Kong Exchange.As we reported before, , as it seeks to attract more catastrophe bond and insurance-linked securities (ILS) business.As a reminder, you can read all about the new catastrophe bond from Peak Re, as well as every other cat bond transaction in our extensive Artemis Deal Directory..

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