Despite a surge of capital into the catastrophe bond market in the second quarter, overall capital in the market declined over the first half of this year.

Reinsurance giant Guy Carpenter’s latest market update reports that eight catastrophe bond transactions totalling $US2.05 billion ($2.28 billion) in risk capital were completed in the second quarter of this year, making it the second most active second quarter on record.

But this wasn’t enough to prevent total risk capital outstanding in the cat bond market at the end of the second quarter declining by 0.8% or $US105 million ($117 million), compared to the end of the first quarter of this year.

The majority of this year’s second-quarter business included exposure to US windstorms, but the forecast active North Atlantic hurricane season has limited appetite for additional US windstorm risk.

However, significant investor appetite remains for US earthquake, European windstorm and Japanese windstorm and earthquake perils.