Munich Re has secured $150m of retrocession cover against European windstorms by issuing a catastrophe bond.

The bond was issued by Ireland-domiciled special-purpose vehicle Queen Street III Capital, and is backed by a US treasury bill fund arranged by Munich Re's in-house asset manager, MEAG. The transaction was structured and arranged by Munich Re.

AIR Worldwide modelled the bond's risk, and it is rated B+ by Standard & Poors. The bond pays investors a coupon of 4.75%. The bond pays out if the weighted market-wide loss from an event reaches a pre-determined point. The market wide losses will be determined by risk data firm PERILS.

Munich Re said Queen Street III was marketed in just three working days, and was "substantially" over-subscribed.

The bond is a follow-up to the $100m Queen Street II, which Munich Re issued in March to protect itself against US hurricanes and European windstorms.