Published September 2019
World Bank Catastrophe bonds as an innovative development financing tool
By Michael Bennett and Rebeca Godoy

Michael Bennett is the Head of the Derivatives and Structured Finance team in the World Bank Treasury, where his area of responsibility includes execution of catastrophe risk transactions. He has worked with the World Bank since 2000 and is a 1990 graduate of the Columbia University School of Law.

Rebeca Godoy joined the Capital Markets group of the World Bank Treasury in December 2012 as a Senior Financial Officer. Her current responsibilities involve working with World Bank’s clients in advising and executing different types of financial and non-financial coverage products in the international markets: from market risk coverage to commodities, catastrophes and weather hedges.

The devastating cost of natural disasters in the developing world

Many countries around the world are extremely vulnerable to natural disasters, such as earthquakes, hurricanes, volcanic eruptions, tsunamis, severe droughts or epidemic outbreaks. While such natural disasters do not discriminate between developed and developing countries, the long-term economic impact on a developing country of such a disaster can be many times more severe than if a similar event occurred in a developed country.