Bamboo Insurance and Sutton National Announce Reinsurance Program Renewal

Rhea-AI Summary

Bamboo Insurance, a subsidiary of White Mountains Insurance Group (NYSE: WTM), and Sutton National have announced the successful renewal of their reinsurance program. The renewal includes two key components:

1. Greengrove Re issued a $100 million catastrophe bond with a 7.75% spread and 1.44% initial base expected loss, maturing April 7th, 2028. The offering exceeded its initial $75 million target by 33%.

2. Greenshoots Re issued $70 million in preference shares for a sidecar transaction backed by institutional investors.

These transactions provide protection against fire and fire following earthquake for California homeowners' business, offering both catastrophe excess of loss and quota share capacity through capital markets. The successful placement, particularly following recent Los Angeles wildfires, demonstrates investor confidence in Bamboo's risk management approach.

Positive

• Successful 33% upsize of catastrophe bond to $100M from initial $75M target
• Favorable pricing achieved at lower end of guidance range
• Strong investor support despite recent Los Angeles wildfires
• Additional $70M raised through sidecar transaction

Negative

• None.

News Market Reaction – WTM

+0.16%

1 alert

+0.16% News Effect

On the day this news was published, WTM gained 0.16%, reflecting a mild positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

MIDVALE, Utah, April 8, 2025 /PRNewswire/ -- Sutton Specialty Insurance Company and Sutton National Insurance Company (together "Sutton National") and Bamboo Ide8 Insurance Services, LLC. ("Bamboo"), a subsidiary of White Mountains Insurance Group, Ltd. (NYSE: WTM), announced the renewal of Bamboo's reinsurance program, which included the successful closing of the Greengrove Re Ltd. Series 2025-1 catastrophe bond and the execution and funding of the Greenshoots Re Ltd. Series 2025-1 sidecar transaction.

"These transactions will strengthen our ability to jointly address the coverage needs of California homeowners..."

Greengrove Re Ltd.
Greengrove Re Ltd. issued a $100 million catastrophe bond with a spread of 7.75%, an initial base expected loss of 1.44% and an indemnity trigger over a three-year term with a scheduled maturity date of April 7th, 2028. The offering reflects a 33% upsize from the initial $75 million placement target, with the final spread priced at the lower end of the initial price guidance of 7.50% to 8.50%.

As part of the transaction, Sutton National entered into a catastrophe excess of loss reinsurance contract with Greengrove Re Ltd., which offers protection against fire and fire following earthquake for business written by Bamboo on behalf of Sutton National and provides both parties with a diversified source of catastrophe excess of loss capacity through the capital markets.

Greenshoots Re Ltd.
Greenshoots Re Ltd. issued $70 million of preference shares for a sidecar transaction supported by several institutional investors.

As part of the transaction, Sutton National entered into a quota share reinsurance contract with Greenshoots Re Ltd., which enables participation in the underwriting results of Bamboo's business written on behalf of Sutton National and provides both parties with a diversified source of quota share capacity through the capital markets.

"These transactions are another milestone in Bamboo's history and in its partnership with Sutton National," said John Chu, CEO of Bamboo. "These transactions will strengthen our ability to jointly address the coverage needs of California homeowners and are a validation of Bamboo's business model, approach to catastrophe risk management, and ability to construct a portfolio which capital markets investors understand and appreciate. We are truly appreciative of investor's support for our inaugural catastrophe bond and sidecar transactions."

"The catastrophe bond and the sidecar are an essential part of our reinsurance structure and complement a catastrophe excess of loss tower and quota share panel backed by industry-leading reinsurers," said Shane Haverstick, CEO of Sutton National. "We are pleased to have successfully sponsored our first catastrophe bond and sidecar, and done so in partnership with Bamboo, our valued partner in the California homeowners' market. We are grateful for the strong investor support across both transactions."

GC Securities, a division of MMC Securities LLC, acted as the sole structuring agent and bookrunner for the catastrophe bond and the sole structuring agent and sole placement agent for the sidecar. Willkie Farr & Gallagher LLP served as deal counsel for both transactions.

"We're proud to have supported Sutton National and Bamboo's inaugural catastrophe bond and sidecar issuance," said Liam Martens, Managing Director of GC Securities. "We are very pleased that investors strongly supported these transactions following the recent Los Angeles wildfires, which we believe reflects a recognition of Bamboo's unique business model and sound approach to catastrophe risk management. We are grateful to both the Bamboo and Sutton National teams for their partnership and their collective effort and expertise in executing these transactions."

MEDIA CONTACT:
Tess Shoe
Sr. Communications Manager | Bamboo Insurance
tshoe@bambooinsurance.com

View original content to download multimedia:https://www.prnewswire.com/news-releases/bamboo-insurance-and-sutton-national-announce-reinsurance-program-renewal-302423553.html

SOURCE Bamboo Insurance

FAQ

What is the size and terms of WTM's Greengrove Re catastrophe bond issued in April 2025?

The Greengrove Re catastrophe bond is $100 million with a 7.75% spread, 1.44% initial base expected loss, and 3-year term maturing April 7th, 2028.

How much did Greenshoots Re raise in its 2025 sidecar transaction for WTM's subsidiary?

Greenshoots Re raised $70 million through preference shares issuance in its sidecar transaction.

What type of insurance protection does the 2025 Greengrove Re catastrophe bond provide?

The bond provides protection against fire and fire following earthquake for California homeowners' business written by Bamboo on behalf of Sutton National.

How did the final Greengrove Re catastrophe bond pricing compare to initial guidance?

The final spread of 7.75% was priced at the lower end of the initial price guidance range of 7.50% to 8.50%.