Sector developments and company hires

Generali debuts green cat bond
Assicurazioni Generali has priced an innovative catastrophe bond. Dubbed Lion III Re, the €200m ILS has a number of sustainable finance features.

First, Generali freed up €28.1m in capital as a result of the protection provided by Lion III Re, which will be allocated to eligible projects as defined by Generali’s Green ILS Framework. Second, proceeds from the sale of the notes will be used to purchase global MTNs issued by the EBRD under its Framework for Environmental Sustainability Bonds, which will be deposited in the collateral account. Finally, reporting on Generali's allocation to eligible projects and a link to EBRD reporting on its green project portfolio will be provided.

The Lion III Re notes pay 3.50% per annum and cover Italian earthquake and European windstorm risks on an indemnity trigger, per occurrence basis. The initial trigger and exhaustion amounts are respectively €400m and €600m for Italian earthquake and €600m and €800m for European windstorm perils.

The initial modelled annual expected loss is 2.99%, with an attachment probability of 3.87% and an exhaustion probability of 2.19%. AIR Worldwide is the modelling agent on the transaction.

GC Securities was structuring agent and joint bookrunner, Barclays was green structuring advisor and joint bookrunner, and Natixis was green coordinator and joint bookrunner.

In other news…

EMEA
USS Investment Management, the wholly-owned investment management arm of the Universities Superannuation Scheme, has appointed Janet Oram as its first head of ABS. Based in London, Oram was previously head of European ABS at BlackRock, which she joined in 2006. Before that, she worked at Fitch and Paragon Banking Group.

Hertz preps bankruptcy exit
Hertz is readying a new rental car ABS facility, which it will use to exit bankruptcy (SCI 14 June). The issuance proceeds from Hertz Vehicle Financing III Series 2021-1 and 2021-2 will be used to: fund the purchase of certain vehicles from Hertz's two existing rental car ABS platforms (Hertz Vehicle Financing and Hertz Vehicle Interim Financing); and pay off the outstanding principal balance of notes issued by Hertz Vehicle Financing II and HVIF. Any remaining proceeds will be used for the acquisition or refinancing of eligible vehicles.

The Series 2021-1 notes will have an expected maturity in 42 months and legal final maturity in 54 months, according to Moody’s. The Series 2021-2 notes will have an expected maturity in 66 months and legal final maturity in 78 months.

The collateral backing the notes is a fleet of vehicles and a single operating lease of the fleet to Hertz for use in its rental car business, as well as certain manufacturer and incentive rebate receivables owed to the SPE by the original equipment manufacturers (OEMs).