Sovereign

A look at some of the key milestones in Sovereign’s history:

• March 4, 1997: ACE, XL and Risk Capital Re announce their intention to form a Bermuda-based managing general agency to underwrite political risk insurance. The new company is called Sovereign Risk Insurance Limited and opens with project limits of $50 million and country limits of $100 million.

• July 1, 1997: Sovereign formally opens for business. Price Lowenstein and Jack Collier are the company’s first two employees.

• October 9, 1997: Leigh Hollywood is hired as Chief Underwriting Officer bringing over twenty years experience in political risk underwriting, including having served as Chief Guarantee Officer at MIGA.

• March 25, 1998: Sovereign announces the signing of a landmark reinsurance agreement with the French Government Export Credit Agency, COFACE. The agreement provides COFACE with $70 million of reinsurance coverage for its portfolio of equity investments in China for a tenor of 10 years. In a joint press release, French Finance Minister Dominique Strauss-Kahn commented: “This first operation reflects the growing importance of the private political risk insurance market and exemplifies cooperation between public and private guarantees.”

• August 3, 1998: Sovereign doubles its per-project limits to $100 million, and increases its country limits to $250 million. Sovereign also expands its product line to include sovereign nonpayment/non-honoring coverage.

• July 9, 1999: Christina Westholm-Schröder is hired as Sovereign’s Senior Underwriting Officer, joining after an 11-year career at MIGA.

• July 26, 1999: Sovereign announces that it will begin its third year of operations by increasing its per project limits from $100 to $125 million and extending its maximum tenors from 10 to 15 years.

• February 21, 2001: Sovereign announces the completion of its first capital markets transaction, a $74 million, 15-year policy covering 31 months of interest on a bond issue by the Argentine province of Salta, which enabled the issuer to achieve a 3 notch upgrade from BB- to BBB- (S&P).

• March 16, 2001: Sovereign announces the signing of the first reinsurance agreement between the Inter-American Development Bank (IADB) and a private insurer. Sovereign provided $50 million of facultative reinsurance behind IADB’s $100 million guarantee to a syndicate of commercial banks financing the expansion and modernization of two electric distribution companies in Brazil.

• April 16, 2001: Nila Davda is hired as a Senior Underwriting Officer, joining Sovereign from the World Bank’s International Finance Corporation (IFC) where she had worked as a senior syndications officer in the IFC’s B Loan program.

• May 14, 2001: Natalie Luthi is hired as Senior Country Research Analyst, joining Sovereign from the Bank of Bermuda.

• September 7, 2001: Sovereign announces completion of a capital markets transaction covering a bond issue by Banco Itau in Brazil. The 10-year policy covered 18 months of interest payments and enabled the issue to achieve an A3 (Moody’s) rating which was seven notches above Brazil’s sovereign rating.

• September 28, 2001: Sovereign is elected as a permanent member of the International Union of Credit and Investment Insurers (the Berne Union).

• November 21, 2001: Sovereign announces completion of a combined monoline-PRI transaction for EKN, Sweden’s export credit agency. Sovereign and XL’s financial guarantee subsidiary combined to provide the agency with $231 million in credit and PRI coverage, assisting EKN in managing its exposure to a Mexican utility.

• March 21, 2002: Dave Bailey is hired as a Senior Underwriting Officer, joining Sovereign from Canada’s export credit agency EDC. He had served with EDC for 23 years most recently as Chief Underwriter of its political risk unit.

• August 5, 2002: Barker Keith is hired as a Senior Underwriting Officer and Assistant General Counsel, joining Sovereign from the law firm Shearman & Sterling's Hong Kong office where he specialized in project and corporate finance law.

• December 17, 2002: Sovereign announces completion of the first cooperation agreement under the Asian Development Bank’s (ADB) Guarantor of Record program. Sovereign provided a 12.5 year, $25 million reinsurance of ADB’s Political Risk Guarantee which was issued to a syndicate of commercial banks financing construction of the Phu My 2.2 power project in Vietnam.

• November 19, 2003: Sovereign announces completion of a capital markets transaction on behalf of Banco Bradesco in Brazil. The 10-year policy covered 18 months of interest and enabled the bonds to achieve a Baa1 (Moody’s) rating, seven notches above the Brazilian sovereign rating.

• December 22, 2003: Sovereign and Export Development Canada (EDC) announce the completion of a $25.4 million, 10-year capital markets transaction supporting a bond issue by TeleNorte Leste Participacoes S.A. (TNL). This marked EDC’s first involvement in a capital markets PRI transaction and the first time that Sovereign had received facultative reinsurance from an official agency. The policy enabled the TNL bond issue to achieve a Baa3 (Moody’s) rating, five notches above the Brazilian sovereign rating.

• October 18, 2004: Sovereign announces completion of a capital markets transaction for a bond issue by Finansbank, Turkey’s fifth-largest private bank. The 10-year policy covers 18 months of interest and enabled the bonds to receive a Ba1 (Moody’s) rating, two notches above Turkey’s sovereign rating.

• November 29, 2004: Sovereign was voted “Best Political Risk Insurer in Trade Finance in 2004” in a poll released by Global Trade Review (GTR).

• February 1, 2006: Sovereign restructures its ownership and becomes 100% owned by ACE Bermuda Insurance Ltd., a wholly-owned subsidiary of ACE Limited.

• June 6, 2006: Sovereign announces completion of a facultative reinsurance agreement with EKF, the Danish national export credit agency. Under this agreement, Sovereign provided reinsurance to EKF for the non-Danish portion of an export transaction to Ukraine. This marked the first time that EKF had used private reinsurance.

• May 14, 2008: Sovereign Risk Insurance Ltd. establishes a wholly-owned subsidiary in Dubai following approval in principle from the Dubai Financial Services Authority. Relocating from Bermuda to Dubai, Nila Davda, Vice President and Senior Underwriting Officer, is appointed head of Sovereign Risk Insurance (Dubai) Ltd., based in the Dubai International
Financial Center.

• October 1, 2008: Sophie Demeyer is hired as a Senior Underwriting Officer, joining Sovereign from Fortis Bank in Brussels where she worked in the Export Finance and Project Finance groups.