Re: Japan Catastrophe Bonds

---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 09/15/2000
04:45 PM ---------------------------

Zimin Lu
09/11/2000 02:06 PM
To: Darren Delage/AP/Enron@ENRON
cc: Stinson Gibner/HOU/ECT@ECT, Vince J Kaminski/HOU/ECT@ECT, Vasant
Shanbhogue/HOU/ECT@ECT
Subject: Re: Japan Catastrophe Bonds

Darren,

Glad to hear from you ! I heard that you moved to Japan, hope everything
goes well for you.

The catastraphe option was listed in Chicago broad of trade, but the open
interest was very small.
Internally, Enron insurance group knows a few insurance companies offer such
product. The contact
person is Jim Bouillion.

If you are interested to offer such bond/insurance in Japan, we can look
into the pricing and "hedging" (i.e. reinsurance)
issues. I will discuss this with Vince, Stinson and Vasant.

Best Regards,

Zimin

From: Darren Delage@ENRON on 09/11/2000 11:33 AM ZE9
To: Zimin Lu/HOU/ECT@ECT
cc:
Subject: Japan Catastrophe Bonds

Hello Zimin. I hope all is well with you.

As you may have heard,I moved to Enron Japan about 2 weeks ago in order to
foster a financial trading presence here, with the intention of utlizing this
location to better optimize the management of Gary's exisitng portoflios, as
well as to identify and act on local trading or financial opportunities.

One peripheral, recurring idea has been for Enron to somehow establish a
market in catastraphe bonds and/or insurance. Earthquakes are perhaps the
greatest risk that the Japanese people fear according to various polls, a
natural response to the significant number of earthquakes that occur in the
area . Such a product would have tremendous and widespread appeal and from a
cursary review, it does not appear that there is a developed,liquid market
for such products.

I was wondering if you could talk to Vince briefly about his thoughts
regarding the feasibility of such a product, in terms of hedging where a
natural offset is not found. Is this a product that research feels a hedge
can be made against with a reasonable amount of statisitcal confidence? I
realise this is vague and if you need any more information, please contact
me.

Sincerely,

Darren
81-3-5219-4635