Arch Mortgage Insurance Company (Arch MI) has secured over $ 639 million in indemnity reinsurance on a pool of approximately $ 28.7 billion in mortgages from Bellemeade Re 2021-3 Ltd., a specialty reinsurer.
The coverage was obtained by issuing approximately $ 508 million in bonds and $ 131 million in direct reinsurance, and covers a portfolio of MI policies issued by Arch MI from April to June 2021.
This Mortgage Insurance Linked Note (MILN) transaction is Arch’s third in 2021 and Bellemeade’s 17th transaction since the program’s inception in 2015.
âThe closing of this transaction brings the total protection provided by the Bellemeade program to $ 1.9 billion since the start of the year, which is a testament to both the strength of the Bellemeade franchise and the market interest. for the mortgage credit risk generated by Arch, âsaid Jim Bennison. , EVP, Alternative markets for Arch MI.
Bellemeade Re 2021-3 Ltd. finances its reinsurance obligations by issuing six categories of amortizable notes with final legal maturities of 10 years.
These include: $ 122,961,000 of class A2 notes, $ 104,926,000 of class M-1A tickets, $ 64,329,000 of class M-1B tickets, $ 81,397,000 of category M-1C, $ 115,524,000 in category M-2 tickets and $ 19,500,000 in category B-1 tickets.
In addition, a total of $ 131,518,000 was placed with a panel of reinsurers.
âThe introduction of a Class A2 is the latest structural refinement of the Bellemeade program to better optimize capital in support of Arch’s mortgage insurance business,â Bennison explained.