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Essent Group has closed a $424.4 million reinsurance transaction and related mortgage insurance-linked notes offering.
According to the company the mortgage insurance-linked securities (ILS) deal will provide the group's subsidiary Essent Guaranty with a fully collateralized excess of loss reinsurance coverage on mortgage insurance policies written by Essent in 2017.
Newly formed Bermuda special purpose insurer Radnor Re 2018-1 has funded its reinsurance obligations through the issuance of three classes of mortgage insurance-linked notes with 10-year legal maturities to eligible third-party capital markets investors in an unregistered private offering.
“This transaction is a significant milestone for our company, as it expands our capital sources while also providing a layer of protection against adverse credit losses,” said Essent chief executive officer Mark Casale.
"Additionally, we believe that a transaction like this strengthens our mortgage insurance franchise and enhances the role that Essent plays in supporting a strong and robust US housing finance system.”
Essent Group, Essent Guaranty, ILS, Radnor Re, Bermuda