CCR Re sets up France-domiciled sidecar 157 Re to access new ILS investors

Medium sized reinsurer CCR Re has set up 157 Re, a sidecar vehicle, which it said is the first to be domiciled in France, to give it access to new ILS investors.

CCR Re explained that to enable this, the sidecar will assume a 25 percent quota share of its worldwide property cat portfolio, providing the reinsurer with fully collateralized capacity. The sidecar will open on 1 April 2019.

This is “the first generation” of what is expected to be an annually recurrent instrument in relationship with investors to support CCR Re’s growth on property cat businesses.

It said the transaction could be “easily duplicated” to cover other types of insurance risks and develop other types of ILS instruments and was “paving the way for the development of an ILS market in Paris”.

The new sidecar will help CCR Re to achieve its aim of a diversified and profitable organic growth. It will also provide the reinsurer with full Solvency II regulatory credit and a new competitive and agile investor base, the company said.

Bertrand Labilloy, chairman and CEO at CCR Re, said: “By creating and sponsoring 157 Re, the first ever French insurance linked securities instrument, CCR Re’s teams have confirmed their innovative skills and mindset, as well as their commitment to promote the Paris financial market place attractiveness and development.”

The reinsurer said it was “proud to have sponsored and contributed to this innovative transaction”. It worked with Willis Towers Watson Securities, acting as structuring agent, France Titrisation, as management company, BNP Paribas Securities Services, as custodian, Linklaters, as transaction counsel, and Clyde & Co, as counsel to CCR Re on the reinsurance matters.

157 Re has been licensed by the French supervisory authority (Autorité de Contrôle Prudentiel et de Résolution) and the French tax authorities have provided formal guidance on the tax treatment of the operation for the investors.

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