USC Annenberg School For Communication and Journalism

World Bank Issues "Catastrophe Bonds"

In collaboration with Mexico, the World Bank has issued $360 million worth of “catastrophe bonds.” Investors quickly picked up these bonds despite the risk involved. These bonds were created to help Mexico pay for emergency relief if by some chance, natural disasters such as an earthquake or hurricane should strike Mexico. If by some chance, a disaster does strike Mexico, investors will lose their money, but many investors felt the reward was well worth the risk. Listen to the story at