ILS investment opportunity “never been so interesting” – VP Bank

VP Bank AG, a Liechtenstein-based private bank and asset manager, has said that the insurance-linked securities (ILS) investment opportunity has “never been so interesting”, with the highest yields in over a decade now possible, and further revaluation gains in hurricane Ian exposed catastrophe bonds expected. All of which leads to the bank and asset manager having a particularly constructive view on the ILS investment market for 2023, with its recommendation being to overweight ILS within investor portfolios. In fact, ILS is still the single most strongly-weighted asset class that VP Bank recommends at this time, given the positive prospects for investing into the ILS asset class right now. VP Bank has been watching the catastrophe bond market closely, as it believes the chance of some additional value being recovered against cat bonds that have been marked down after hurricane Ian is high, citing the NFIP’s FloodSmart Re cat bonds in particular . Right now, the entry point into catastrophe bonds is particularly attractive anyway, purely based on the forward-potential for returns from new issuances at the much higher spreads the market is clearing at today. But, if you also take into account the fact valuations are depressed in some […]

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