Business
Arch MI Secures Over $233 Million of Indemnity Reinsurance through Bellemeade Re Insurance-Linked Note Transaction and Related Reinsurance
GREENSBORO, N.C.--(BUSINESS WIRE)-- Arch Mortgage Insurance Company (Arch MI) announced it has obtained over $233 million of indemnity reinsurance on a pool
About this update from Arch Capital Group Ltd.
[{"type":"text","content":" GREENSBORO, N.C.--(BUSINESS WIRE)--\nArch Mortgage Insurance Company (Arch MI) announced it has obtained over $233 million of indemnity reinsurance on a pool representing approximately $32.4 billion of mortgages from Bellemeade Re 2023-1 Ltd., a special purpose reinsurer. The coverage was obtained by issuing approximately $186 million in bonds and $46 million in direct reinsurance. This transaction largely covers a portfolio of MI policies issued by Arch MI and affiliates primarily from January 2023 through September 2023 and closed on Oct. 31.\n\n\nThis Mortgage Insurance-Linked Note (MILN) transaction is Arch’s first of 2023. Since the Bellemeade program began in 2015, Arch has completed 20 transactions that have secured over $9 billion in indemnity reinsurance.\n\n\nBellemeade Re 2023-1 Ltd. is funding its reinsurance obligations through the issuance of five classes of amortizing notes with 10-year legal final maturities.\n\n\nThe notes received ratings from DBRS Morningstar as follows: Class M-1A was BBB (low)(sf), Class M-1B was BB (high)(sf), Class M-1C was BB (low)(sf), Class M-2 was B (high)(sf) and Class B-1 was B (sf).\n\n\nPricing detail for the four classes of offered notes is below:\n\n\n\n$49,755,000 class M-1A notes with a coupon equal to one-month SOFR plus 2.20%.\n\n\n\n$54,731,000 class M-1B notes with a coupon equal to one-month SOFR plus 4.25%.\n\n\n\n$42,292,000 class M-1C notes with a coupon equal to one-month SOFR plus 4.85%.\n\n\n\n$27,365,000 class M-2 notes with a coupon equal to one-month SOFR plus 5.65%.\n\n\n\n$12,438,000 class B-1 notes with a coupon equal to one-month SOFR plus 6.70%.\n\n\n\nAdditionally, a total of $46,647,000 was placed with a panel of reinsurers.\n\n\n“Our ability to secure such favorable pricing speaks to the strength of our business, especially when compared to other recent deals we’ve seen in the market,” said Jennifer Weiss, VP of Structured Capital and Reinsurance for Arch MI. “Bellemeade is a key element of our risk and capital management strategy. We are glad to see strong, continued support from both investors and reinsurers.”\n\n\nAbout Arch MI\n\n\nArch MI, a wholly owned subsidiary of Arch Capital Group Ltd., is a leading provider of private insurance covering mortgage credit risk in the U.S. Headquartered in Greensboro, North Carolina, Arch MI's mission is to protec...