Bookrunner Goldman Sachs priced the Residential Re U.S. hurricane risk securitization last Friday at +490bp/3ML (par). The 3-year bullet for United States Automobile Association (USAA) was upsized to $125 million from $100 million. Lehman Brothers and Merrill Lynch were co-leads on the all pot issue.
Investors in the Residential Re trade provide reinsurance coverage for three years to USAA against hurricane losses in the East and Gulf Coast states as well as Hawaii.
Year-to-date, the catastrophe bond sector has seen at least $927 million in volume via seven issues. This matches 2001's full year volume, which only saw six deals.
