Lloyd’s capacity auctions kick-off with £133m sold in round one

The first round of 2022 capacity auctions at  Lloyd’s saw £133.28 million of capacity from 17 syndicates trade hands for £46.77 million, an average price of 35.09p per pound.

Buyers placed £1.02 billion in bids against the £198.80 million in tendered capacity, rendering a bid to offer ratio of 5.14x, down from the 9.2x in a smaller prior year first round that had rendered average prices at 32.30p per pound.

Deal prices had ranged from the penny on the pound all the way to £2.10 per pound capacity on a smallish deal in syndicate 1176.

Individual members were "the most significant buyers" of capacity at more than half of total exchanged volume, analysts at Argenta said in a note following the auction.

Some "notable acquisitions" also came from aligned vehicles, including from Beazley, Lancashire and Tokio Marine Kiln, Argenta noted.

Amongst most traded positions, Beazley’s syndicate 0623 saw £39.65 million in capacity exchange hands for £13.85 million, an average price of 34.9p per pound.

Some £32.29 million in capacity changed hands in a flurry of activity around Tokio Marine syndicate 0510 for £10.80 million, rendering an average price of 33.4p per pound.

The two-day sale was the first of three auctions to be held in October/November 2022. Buyers and sellers will face off again November 2-3 and again November 9-10.

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