Arch MI Secures Over $449 Million of Indemnity Reinsurance Through Bellemeade Re Insurance-Linked Note Transaction and Related Reinsurance

2020 SEP 14 (NewsRx) -- By a News Reporter-Staff News Editor at CDC & FDA Daily -- Arch Mortgage Insurance Company (Arch MI) announced that it has obtained over $449 million of indemnity reinsurance on a pool representing approximately $32 billion of mortgages from Bellemeade Re 2020-2 Ltd., a special purpose reinsurer. The coverage was obtained by issuing approximately $423 million in bonds and $26 million in direct reinsurance. This transaction covers a portfolio of MI policies linked to 117,562 loans and issued by Arch MI and affiliates primarily in the first five months of 2020.

This Mortgage Insurance-Linked Note (MILN) transaction is Arch’s second of 2020. Arch’s earlier MILN, Bellemeade Re 2020-1, was the first mortgage credit risk transfer (CRT) completed by any company in the COVID-19 era. The most senior class M-1A of notes received an A2 rating by Moody’s Investors Service and a BBB (high) from DBRS Morningstar.

The MILN is funding its reinsurance obligations through the issuance of five classes of amortizing notes with 10-year legal final maturities.

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