Arch Mortgage Insurance has secured $506,110,000 of indemnity reinsurance from Bellemeade Re 2018-3, a special purpose reinsurer.
The reinsurance is for a portfolio of mortgage insurance (MI) policies issued by Arch MI and affiliates primarily during the first half of this year. The most senior M-1A class notes received an A rating from Morningstar Credit Ratings.
This transaction marks the third time this year that Arch MI has accessed the capital markets for a risk transfer involving an MI portfolio.
For this year, these three transactions have garnered $1.534bn of reinsurance protection for loans representing more than $136bn of unpaid principal balance.
Bellemeade Re 2018-3 is funding its reinsurance obligations through the issuance of four classes of amortizing notes with 10-year legal final maturities. This Insurance-linked Security (ILS) transaction provides Arch MI with collateralized coverage from Bellemeade Re 2018-3 for potential losses on a portion of its MI portfolio.
Arch’s Global Mortgage Group CEO Andrew Rippert said: “Completing our third ILS transaction of 2018 demonstrates our appetite to continue leveraging reinsurance protection to manage our regulatory capital position.
“We continue to be pleased with the investor interest in these structures and look to expand the investor base moving forward.”
Source: Company Press Release