World Bank’s cat bond scheme launches in Mexico

Swiss Re is sharing the placement of a three-year securitisation for $290mn of hurricane and earthquake risk for the Mexican government. The securitisation is the first in the World Bank’s new Multicat programme; a cat bond issuance platform that offers governments and other public bodies access to international capital markets to insure against the risk of natural disasters. Known as Multicat Mexico 2009 Ltd, the transaction will provide the Mexican government with the funding to finance disaster relief efforts after earthquakes and hurricanes. Swiss Re said the Mexican cat bond “serves as proof of the continued viability and attractiveness in the market for Insurance Linked Securities (ILS)”. Cat bonds have performed remarkably well during the financial crisis, Swiss Re said.