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Catco retro market share hits 20%

Qatari-backed collateralised reinsurance fund Catco now has a 20 percent share of the retro market, according to the London-listed firm.

"This is very satisfying amidst a changeable retrocessional environment, and in only three years of existence," the company wrote last week, citing estimates from Guy Carpenter.

Catco deployed more than $2bn of collateralised retrocession limit at the start of 2013.

The firm said it had suffered "little or no effect" from oversupply of capital in the catastrophe bond sector.

"In this specialist sector of reinsurance, it is the strength of relationships and continuity which remain so highly valued by cedants," the firm explained last week.

Bermuda-headquartered Catco made a 7.9 percent net asset value return in the first six months of 2013, net of performance fees, and the company said it was on track to meet a 28 percent annual target if it continues to avoid catastrophe losses this year.

This has risen from a 27 percent target at the start of the year and from the 23 percent return targeted in 2012.

However, the actual 2012 return for investors with exposure to the earthquakes in New Zealand and Japan was a 4.3 percent loss.

In spite of the higher 2013 target, the manager said that the portfolio had been de-risked, as it included wider geographic exposures and risk pillars compared to previous years.

It is holding a side pocket of cash equivalent to 7.34 percent of shareholder funds to cover remaining potential claims.

Catco also took losses from the Costa Concordia sinking last year.

The manager controls $362mn through the listed, closed-ended Catco Reinsurance Opportunities Fund, but also runs private funds.

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