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Fermat Capital launches cat bond fund for New Zealand investors

The new PIE-structured fund targets a lower tax rate for eligible investors, feeding into Fermat’s roughly $2.8 billion Cayman Islands catastrophe bond strategy.

Reported · Written up by our desk · Fund Industry

Fermat Capital Management has launched the Fermat Cat Bond PIE Fund for investors in New Zealand, positioning it as the first cat bond fund structured in the tax efficient Portfolio Investment Entities, or PIE, format for an insurance-linked securities strategy.

Artemis reports that the firm is also expanding its distribution through a build-out of its investor relations team, including the hire of Greg Hickling as an Investment Director in APAC, as well as new funds and access points aimed at institutions and large investors. Fermat said the PIE structure can mean fund income is taxed at a Prescribed Investor Rate capped at 28%, rather than an investor’s marginal rate that can run as high as 39%.

The fund is designed to act as a feeder into Fermat’s roughly US $2.8 billion Cayman Islands domiciled Fermat catastrophe bond strategy. Artemis also said Fermat partnered with New Zealand based Adminis, which provides services including investment accounting, administration, custody, registry, and portfolio and performance reporting, to support fund operations in the country.

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