The Hong Kong Special Administrative Region (HKSAR) government on Tuesday welcomed the issuance of insurance-linked securities (ILS) in the form of a catastrophe bond by the World Bank in Hong Kong with a size of 350 million U.S. dollars, offering protection against losses related to earthquake risks in Chile over the next three years.This is the first World Bank bond and the first catastrophe bond ever listed on the Hong Kong Exchanges and Clearing Limited (HKEX)."It bears testament to Hong Kong's position as an international financial center and the vibrant development of the Hong Kong insurance industry," said Paul Chan, financial secretary of the HKSAR government.Against the backdrop of a rising trend of catastrophic events caused by climate change, the HKSAR government is committed to supporting the Hong Kong insurance sector in offering a greater variety of comprehensive products and solutions to assist Chinese and global market players for better management of relevant risks, Chan said.The catastrophe bond is supported by the Hong Kong Insurance Authority (IA) which administers a grant scheme established in 2021 to encourage the development of the ILS market in Hong Kong."The decision by a prominent international body like the World Bank to partner with Hong Kong marks an important milestone in our journey of striving to become a vibrant ILS hub," said IA Chairman Stephen Yiu.This Chile catastrophe bond is an example of how countries are putting in place financial safety nets to mitigate the potentially disruptive economic impacts of earthquakes, said Vice President and Treasurer of the World Bank Jorge Familiar."We are pleased to partner with the Hong Kong Insurance Authority and the Hong Kong Stock Exchange in their efforts to evolve the ILS market, which strengthens the resilience of World Bank members to natural disasters," he said.The catastrophe bond is part of a 630-million-U.S.-dollar aggregate earthquake risk coverage transaction for Chile that also includes catastrophe swaps of 280 million U.S. dollars, the World Bank said in a statement, noting that it is the largest ever single-country catastrophe risk transfer transaction.To mark the inaugural listing of ILS, a gong-strike ceremony was held at the HKEX on Tuesday with the presence of representatives from the World Bank, the HKSAR government and the IA.HKEX Chief Executive Officer Nicolas Aguzin said the listing of the World Bank catastrophe bond reflects Hong Kong's growing attractiveness as a platform for international issuers looking to access the region's deep and diverse funding pool."This is also a particularly celebratory first, as the catastrophe bond helps to bring impactful change to communities by helping them better prepare for adversities brought about by natural disasters," said Aguzin.The Hong Kong Special Administrative Region (HKSAR) government on Tuesday welcomed the issuance of insurance-linked securities (ILS) in the form of a catastrophe bond by the World Bank in Hong Kong with a size of 350 million U.S. dollars, offering protection against losses related to earthquake risks in Chile over the next three years.This is the first World Bank bond and the first catastrophe bond ever listed on the Hong Kong Exchanges and Clearing Limited (HKEX)."It bears testament to Hong Kong's position as an international financial center and the vibrant development of the Hong Kong insurance industry," said Paul Chan, financial secretary of the HKSAR government.Against the backdrop of a rising trend of catastrophic events caused by climate change, the HKSAR government is committed to supporting the Hong Kong insurance sector in offering a greater variety of comprehensive products and solutions to assist Chinese and global market players for better management of relevant risks, Chan said.The catastrophe bond is supported by the Hong Kong Insurance Authority (IA) which administers a grant scheme established in 2021 to encourage the development of the ILS market in Hong Kong."The decision by a prominent international body like the World Bank to partner with Hong Kong marks an important milestone in our journey of striving to become a vibrant ILS hub," said IA Chairman Stephen Yiu.This Chile catastrophe bond is an example of how countries are putting in place financial safety nets to mitigate the potentially disruptive economic impacts of earthquakes, said Vice President and Treasurer of the World Bank Jorge Familiar."We are pleased to partner with the Hong Kong Insurance Authority and the Hong Kong Stock Exchange in their efforts to evolve the ILS market, which strengthens the resilience of World Bank members to natural disasters," he said.The catastrophe bond is part of a 630-million-U.S.-dollar aggregate earthquake risk coverage transaction for Chile that also includes catastrophe swaps of 280 million U.S. dollars, the World Bank said in a statement, noting that it is the largest ever single-country catastrophe risk transfer transaction.To mark the inaugural listing of ILS, a gong-strike ceremony was held at the HKEX on Tuesday with the presence of representatives from the World Bank, the HKSAR government and the IA.HKEX Chief Executive Officer Nicolas Aguzin said the listing of the World Bank catastrophe bond reflects Hong Kong's growing attractiveness as a platform for international issuers looking to access the region's deep and diverse funding pool."This is also a particularly celebratory first, as the catastrophe bond helps to bring impactful change to communities by helping them better prepare for adversities brought about by natural disasters," said Aguzin.
