In this “Word on the Street” video from the US Risk Transfer Conference in Charlotte, North Carolina, experts from Guy Carpenter’s Mortgage and Structured Credit Segment, Chris Moses, Senior Vice President, and Rick Robinson, Vice President, discuss capital needs for government-sponsored enterprises (GSEs) and how reinsurance can help GSEs and bank clients meet capital requirements.
“What we saw early on is the GSEs decided to tap multiple forms of capital, accessing both capital markets and reinsurance, and it’s provided them a few benefits over the years that I think our bank clients can learn from as well,” Chris explained.
“So, the question becomes, what’s the best possible way to manage that credit risk and those capital requirements?” Rick said. “And the answer is finding a source of capital that’s innovative. Cue reinsurance. Reinsurers are not transactional, so in times of market turmoil, the partnership really comes in. They step up to the plate.”