December 3, 2023

Fermat Capital Management’s assets under management are fast approaching the milestone of $10 billion as a result of successful financing efforts, strong growth in catastrophe bonds and insurance-linked securities (ILS) assets.

Fermat Capital Management logoFor over a year, Fermat has been the largest specialist investment manager in catastrophe bonds and insurance-linked securities (ILS) by assets.

In the latest list of ILS fund managers disclosed by managers to Artemis, Fermat revealed that its catastrophe bond and ILS assets under management reached $9.8 billion as of May 2023.

That’s up from $8.9 billion in mid-2022, but even more impressively, it’s more than $1 billion higher than the reported ILS AUM at the end of 2022.

This represents a 12% to 14% increase in Fermat Capital Management’s ILS assets under management in the first five months of 2023 alone.

It’s worth noting, however, that this growth is expected to be partly due to a recovery in cat bond valuations, as it likely has the largest cat bond portfolio in the market, so near-term valuations for global assets will Declining and recovering pressures related to values ​​and uncertainty from Hurricane Ian the market experienced.

But it’s clear that Fermat is also seeing strong investor inflows in 2023, helping it grow its catastrophe bond fund strategy significantly.

Recall that John Seo, co-founder and managing director of Fermat Capital Management, said earlier this year that the management firm had set a goal of raising $2 billion in new capital by 2023, roughly half of the amount expected in the first half of this year.

That now appears to be the case, with Fermat on track to achieve this goal by the end of the year.

As long as cat loss activity or any other global event (catastrophic or macro) does not derail the cat bond market, Fermat appears to have ample opportunity to expand its asset base further through the remainder of 2023 as catastrophes Losses are strong. We’ve seen what’s happening with bond issuance, and we expect that to continue later in the year.

To view information on the many specialized ILS fund managers and reinsurers offering ILS-style investment opportunities, visit our Directory of insurance-related securities investment managers and funds.

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