PIMCO, the Newport Beach, Calif.-based fixed income investment manager, has hired Rick Pagnani from Mt. Logan Re as executive vice president, to lead the launch of the firm’s property and casualty insurance linked securities (ILS) business.
The ILS market, which offers low correlation to other asset classes and limited sensitivity to moves in interest rates, is a strategically important asset class for PIMCO’s broader alternatives platform, with more than $34 billion of assets under management, said PIMCO in a statement.
PIMCO said it will work in partnership with its parent, Allianz, to source global catastrophe risk in the form of collateralized reinsurance and other structured investments, while maintaining independent underwriting and portfolio construction procedures. This differentiated approach will also give PIMCO the flexibility to source risk from the open market in an effort to deliver attractive risk-adjusted returns for clients, the company added.
Pagnani, who has more than 30 years of experience in the ILS market, “will lead a group of dedicated professionals and incorporate robust underwriting and risk management tools for the business,” said PIMCO.
He reports to Nic Johnson, managing director and portfolio manager. Prior to joining PIMCO, Pagnani was chief executive officer of Mt. Logan Re where he launched the third-party ILS investment business of Everest Reinsurance. Prior to joining Everest in 2012, Pagnani was a partner at TigerRisk Partners and chief executive officer of Ascendant Reinsurance, a Bermuda-based reinsurance company focusing on catastrophe derivatives. He also was a managing director of Swiss Re New Markets. Pagnani holds an MBA from Fordham University and a bachelor’s degree from Hobart College.
“We are excited to enter the insurance-linked securities market at a time when volatility has become a mainstay of financial markets and clients want to diversify their investments,” said Emmanuel Roman, PIMCO’s chief executive officer. “Partnering with Allianz will give PIMCO access to a diversified portfolio of global catastrophe risk and the ability to leverage the robust capabilities of a premier global insurance group in our effort to deliver attractive risk-adjusted returns for clients.”
“We believe that this partnership of PIMCO and Allianz truly leverages the strengths of both companies,” says Amer Ahmed, CEO of Allianz Re. “With PIMCO we have a partner with access to an investor base that can provide the capital for which Allianz can supply insurance risks, both traditional catastrophe exposure risks and over time other risk classes. At Allianz we are excited that this will enable us to expand our underwriting capacity and generate new fee-based income streams.”
Together with Allianz Re, Allianz Group’s corporate insurance carrier Allianz Global Corporate & Specialty will support the PIMCO ILS business through access to its international underwriting network and the deal structuring capabilities of its Capital Solutions team.
Source: PIMCO
Topics Mergers & Acquisitions New Markets Reinsurance Allianz
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