SCOR issues $200m three year transaction led by BNP Paribas and Deutsche Bank

French reinsurer SCOR has launched a new cat bond, according to sources.

The bond is said to be a $200m three year transaction, and marks the first new issue since the collapse of Lehman Brothers last September disrupted the cat bond market.

The new SCOR catastrophe bond covers U.S. windstorms and earthquakes. It has three tranches, two of $50 million and one of $100 million. The bond is issued via special purpose vehicle Atlas V.

BNP Paribas and Deutsche Bank are lead managers.

The move is significant for the cat bond market, which has effectively been on hold as banks and investors worked on changes to rules governing investment of collateral for the bonds.

Details of collateral arrangements for the current SCOR bond are not yet known. Some suggested that the collateral might be invested in only high-quality government bonds. This would mean that it would be difficult to achieve a high yield.

More cat bonds are thought to be in the preparation phase.