Schroders Capital’s Insurance Linked Securities team scoops accolade at Digital Asset Awards 2024
Schroders Capital’s Insurance-Linked Securities (ILS) team has won the ‘Best Decentralised Finance (DeFi) Initiative’ at the Digital Assets Awards 2024 for its innovative tokenisation pilot that enhances the way insurance-linked securities are invested and managed.
Winners were evaluated through a comprehensive assessment framework that identified best-in-class entries based on key criteria such as innovation, transaction capability, interoperability and risk management.
Schroders Capital‘s award-winning proof of concept was developed in collaboration with Hannover Re, a global reinsurance company. The initiative, which was trialled by Schroders on an internal-only basis, successfully demonstrated how reinsurance contracts can be tokenised and traded on a public blockchain platform using smart contracts. Each token represented a share in a portfolio of reinsurance contracts, demonstrating how ILS funds may invest via a digital ecosystem in the future.
Tokenising these contracts, with the consistent oversight of investment professionals, allows many time-consuming processes to be automated. For example, the pilot was able to streamline the investment process by automating subscriptions and reducing settlement times.
This project was the result of more than a year of collaboration between Schroders, Hannover Re and I.AM Labs, under the oversight of the Guernsey Financial Services Commission (GFSC).
Stephan Ruoff, Co-Head of Private Debt and Credit Alternatives, Schroders Capital, said:
“We are honoured to receive this award and the recognition of our commitment to continued innovation. Our collaboration with Hannover Re exemplifies how tokenisation can revolutionise the way we can approach insurance-linked securities, enabling greater efficiency and transparency. As we continue to explore new technological frontiers, our aim remains to enhance the investment experience for our clients, while ensuring robust risk management and capabilities.”
The Digital Assets Awards aim to highlight the transformative impact of new technologies, systems, and processes on the creation, management, and utilisation of digital assets. For the ‘Best Decentralised finance initiative’ category, Schroders Capital distinguished itself with their innovative and layered approach to its work.
Henning Ludolphs, Managing Director Retrocession & Capital Markets, Hannover Re, said:
“Together with Schroders, we have demonstrated how such an innovative product can be developed through pragmatic collaboration. With this tokenisation pilot, we were able to build knowledge and skills for future technologies. My congratulations go to the Schroders Capital project team.”
Nirav Patel, Managing Director and Editor, The Digital Banker, commented:
“Schroders Capital’s innovative tokenisation pilot represents a significant advancement in the insurance-linked securities market. By successfully facilitating the tokenisation and trading of reinsurance contracts on a public blockchain, they have not only streamlined labour-intensive processes but also improved accessibility for a wider investor base. This initiative exemplifies the transformative potential of digital assets in enhancing the client experience and integrating with modern financial ecosystems.”
The pilot further builds on Schroders Group’s commitment to innovation and leadership in digital assets, after having joined the Monetary Authority of Singapore’s Project Guardian and participating in the first ever GBP Digital Bond issued by the European Investment Bank. Schroders has also invested in AI applications to support its people, including being one of the first asset managers to launch an in-house AI assistant available to employees globally and a Generative AI Investment Analyst platform enabling its private equity team to speed up the analysis of large volumes of data.
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Schroders Capital provides investors with access to a broad range of private market investment opportunities, portfolio building blocks and customised private market strategies. Its team focuses on delivering best-in-class, risk-adjusted returns and executing investments through a combination of direct investment capabilities and broader solutions in all private market asset classes, through comingled funds and customised private market mandates.
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