Good day, and welcome to W. R. Berkley Corporation's Second Quarter 2024 Earnings Conference Call. Today's conference call is being recorded. The speakers' remarks may contain forward-looking statements, some of which forward-looking statements can be identified by the use of forward-looking words, including, without limitation, believes, expects, or estimates. We caution you that such forward-looking statements should not be regarded as a representation by us that the future plans, estimates, or expectations contemplated by us will, in fact, be achieved. Please refer to our annual report on Form 10-K for the year ending December 31, 2023, and our other filings made within the SEC for a description of the business environment in which we operate and the important factors that may materially affect our results. W. R. Berkley Corporation is not under any obligation and expressly disclaims any such obligation to update or alter its forward-looking statements whether as a result of new information, future events, or otherwise. I would now like to turn the call over to Mr. Rob Berkley. Please go ahead, sir.

Krista, thank you very much. We appreciate you getting us through that marathon of a safe harbor statement. And good afternoon to all, and welcome to our Q2 call. Thank you for finding the time, and thank you for the interest in the company. Along with me on the call, you have Bill Berkley, Executive Chair, as well as Rich Baio, Executive Vice President and Chief Financial Officer of the group. We're going to follow our typical agenda where momentarily I'll be handing it over to Rich, he'll run through some highlights for you all, he'll then flip it back to me, I'll offer a few of my own observations on both the industry as well as our quarter, and then we'll be pleased to open it up for Q&A. Before I hand it to Rich, I guess perhaps stating the obvious, clearly an active quarter of frequency of what I would define as severity, but perhaps relatively modest severity on the property front. From our perspective, it was an opportunity for this organization to differentiate itself as it does when there is severity on the property market front. And in spite of all the challenges, we were still able to deliver a 91% combined. I guess for those that subscribe to the [but for] (ph) club, it would be an 88%. But when we look at the goal of the exercise being to generate good risk-adjusted returns to build the book value, we are of the view that cats do count and so does net development. In our opinion, it's not just about the steps forward that you take, it's also about the steps backwards that you will avoid. And that is very much woven into how we approach the business on all fronts. So with that, I will hand it to Rich, and I will follow him in a couple of minutes. Rich, if you would, please.

Of course. Thanks, Rob, and good evening, everyone. The company continues to perform well with a second quarter annualized return on beginning of year equity of 20% on a net income basis and 22.4% on an operating earnings basis. References to per share information in my comments and the earnings release have been adjusted for the 3-for-2 common stock split effected on July 10. Operating income increased approximately 35% to $418 million or $1.04 per share, driven by strong underwriting and investment income. Growth of 11.2% in net premiums written to a record $3.1 billion represents the first time above $3 billion for a quarter, and provides the opportunity for continued record setting net premiums earned beyond this quarter. The US dollar strengthens to many foreign currencies in the quarter, adversely impacting the growth rate by approximately 90 basis points, and accordingly would have been 12.1% excluding the foreign currency impact. We grew in both segments of our business, led by the Insurance segment with 12.2% growth unadjusted for foreign currency, and the Reinsurance & Monoline Excess segment increased 3.5% led by property. Pre-tax underwriting income was $254 million, which included $90 million of catastrophe losses or 3.2 loss ratio points. Heightened catastrophe events during the quarter led to the increase in cat losses of 1.1 loss ratio points over the prior-year quarter, well below what we would expect will impact the industry. Our careful and prudent management of cat risks has continued to result in stability in earnings. Our accident year loss ratio, excluding cats, is at 59.4%, slightly below the prior year's 59.5%. The prior-year accident development was favorable by $1 million, combined with the previously mentioned cat losses brings our calendar year loss ratio to 62.6%. The expense ratio increased 40 basis points to 28.5%, primarily due…

Okay. Thanks, Rich. That was great. A couple of comments from me, maybe starting on the more macro and the industry and then we can touch on our quarter as promised. So, from my perspective, the industry continues to be one that responds to pain. Pain is the catalyst for discipline and change. We see that from one product to another. I guess perhaps one analogy would be the cast may change, but generally speaking, the script does not change. Unfortunately, it's somewhat predictable. Speaking of change, certainly, we are seeing a bit of a tempering on the financial and economic inflation front. That having been said, social inflation shows no sign of abating. Social inflation is something that we have been very actively and loudly talking about going back to 2018 when we started to wave our arms and share with people what we were seeing in loss trend. One of the challenges, particularly as of late, and it's really in much of the country is there's a bit of resistance to in amongst many insurance departments and allowing carriers to get rate filings that they need to keep up with loss cost trend. That consequently has been creating and continued to create an opportunity in the specialty lines, in particular the E&S lines as the standard market is not able to get their rates to where they need to be, again, given what trend is driven by social inflation. I'm not going to get into every nook and cranny of every major commercial line, but I will flag that auto liability continues to be an area of concern, and obviously, by extension that can feed into the umbrella line. From our perspective, when you talk about social inflation, there is no product line that is more exposed than…

Thank you. [Operator Instructions] Your first question comes from Elyse Greenspan with Wells Fargo. Please go ahead.

Hi, Elyse. Good afternoon.

Hi. Thanks. Good afternoon as well. My first question, you hit on in your comments, right, a lot of interest in reserves these days across the industry. I know you guys said you released $1 million in the quarter. Could you just provide some more color, be it the breakdown between insurance and reinsurance or anything by accident year, just to give us a sense of what's going on within that?

Why don't -- Rich has the insurance versus reinsurance. And if you're looking for more detail, I would suggest that if you don't mind, Elyse, just follow up with Rich and Karen and they'll give you as much detail as they're legally allowed to.

So, on the Insurance segment, we developed favorably by $2.5 million. And on the Reinsurance & Monoline Excess segment, we developed unfavorably by $1.5 million. So that's headed down to the $1 million.

I would just add there's a lot of gives and takes on each one of those, depending on the product line. And for our purposes, we're looking at it by operating unit, by product line.

Okay. And then maybe another one for Rich. You guys had given some guidance on the Argentinian inflation-linked securities. Where did that come in in the quarter? And do you have a sense of what that could provide in the third quarter?

So, in the second quarter, we wound up reporting $63 million on inflation linkers. So, it was within the high end of the range. And then, if you were to look at a normalized level with regards to the linkers on a go-forward basis looking out over the next few quarters, we would anticipate, depending on inflation, where it goes, it could be somewhere between $20 million and $30 million.

And just to add to that, Rich, maybe what you were just sharing is sort of contribution and what it means on operating. If you could circle back and give Elyse a sense what it means on the net as well because of the FX fees and so on? Because I think it's important that people have the full picture on this.

Absolutely. So, in the quarter, one of the things that you'll have noticed is that we had about $58 million of losses on I'll say a realized/unrealized capital gain perspective. There's a number of moving pieces in there. But to Rob's point, there's about $50 million of foreign currency losses that are reflected in that number. So that would offset the $63 million that we reflected in net investment income. So, on a net income basis pre-tax, you have about $13 million of impact, if you will impacting the net income. And if we were to look out into the foreseeable quarters, you'll likely see a similar situation arise where FX will largely offset the impact that's coming through on the net investment income side.

Thanks. And one last one. Rob, you said 8.3% rate ex workers' comp in the quarter. I think that went up 50 basis -- that went up 50 basis points sequentially. What was the driver of the increase?

We charged more.

Well, which lines contributed?

I have the aggregate in front of me. Elyse, if you want to circle back with us, we'd be happy to and share it with you. But what I would tell you is probably auto is the leading candidate. So, when you look at -- maybe, just -- maybe more than you're looking for, but I'll throw it out there anyways. When you look at the growth, for example, where we break it out in the release, the auto line is growing at almost 16%. What's driving that is rate, rate, rate per the comments earlier. So, auto is the leading candidate these days.

Okay. Thank you.

Yeah.

Your next question comes from the line of Rob Cox with Goldman Sachs. Please go ahead.

Hi, Rob. Good afternoon.

Hey, good afternoon. I appreciate you taking the question. Yeah, I just wanted to go back to reserves. Rob, you mentioned some bigger movements. I don't know if that's bigger than usual this quarter between product lines, but any further color on the reserve movements by product line?

Sorry. I don't recall commenting on reserves by product line. Rich, did you hear something by product line?

No.

Yeah. So, there was no commentary on that, Rob. I'm not quite sure what you're referring to, excuse me.

I was just commenting on how you said there was like, puts and takes, I think by product...

Yeah. I mean ultimately, the point that I was trying to articulate was that we got 60 different businesses that make up the group, and we're looking at both in the aggregate as well as at a very granular level. So, when you hear about the development that Rich looked at, I think that the reality is that there are a lot of pluses and minuses, and that's just where it came out to, but as far as specifics as it relates to what's happening, that'll probably be more detail in the Q.

Okay. Got it. Thanks. And then, just as a follow up, I wanted to just go back to some of the comments from last quarter on raising some IBNR in the insurance picks, and if there was any movement in sort of how you guys looked at loss trend across product lines within the Insurance segment this quarter?

Well, honestly, Rob, I don't have a clear recollection of what you're referring to. I think, generally speaking, we feel pretty good about our picks, but as mentioned earlier, alluded to earlier, we're paying close attention to the auto liability line.

Okay. Got it. Thanks.

Your next question comes from the line of Josh Shanker with Bank of America. Please go ahead.

Hi, Josh. Good afternoon.

Hi. I'm going to get my chances on reserves.

Okay.

We'll see what I can find. So, one of your competitors, or maybe one of your peers, I should say, said there's been an elongation in the pace of when claims are being paid. And being paid at a higher level of severity. To the extent that -- that doesn't mean you couldn't have reserved and anticipated for, but is there another pig that the python has swallowed for the industry in '22 and '23 that the claims are coming in differently than they would have looking at the trends from the years prior?

Nothing that's noteworthy from our perspective. Josh, we're not the biggest property shop that you cover, but we certainly do play in the space. And at this stage, we're not noticing any meaningful pattern of an elongation of the property claims tail.

And you cited, of course, the difficulties persistently with a line like commercial auto liability when you talk about how much IBNR you're putting up, are there certain lines that are getting that special IBNR focus that are driving that in particular?

I think. Really what we're focused on, Josh, is the claims environment and making sure that we are acutely aware of where that is going. We have taken a tremendous amount of rate and a variety of other actions, and we continue to pay close attention to that. And when I was making the comment earlier about being sensitive to different legal venues, that would certainly apply to commercial auto or auto liability, if you like. So, when we look at that product line, are we trying to make sure that we are approaching it with the appropriate level of caution? Absolutely.

And if I can sneak one more in for Rich. And I guess in past quarters, we're talking about the high interest yield opportunity in fixed income markets. And I think it was said that the appetite for the proportion of income going into alternative strategies will be lower given how much money you can make in bonds, but I notice the proportion of alts has been creeping up over time. Is that just an unusual quirk? Are you seeing different opportunities in the alternative markets that you couldn't see six and twelve months ago.

Josh, I think it's really more around commitments that we make, so as you can imagine, these are private equity like investments and so when you make an investment in a particular fund, you're committing to a certain amount of capital over time. So that's what's giving rise to the increase in the dollars that are showing up there, if that's what your question is.

But I would just add to Rich's comments, Josh, we are -- given where interest rates are, from our perspective, alternatives are really not of great interest to us going forward. Could there be an exception here or there? Absolutely. We are very pleased with the opportunity that the fixed income market offers, and I think you will see us continue to lean into that at this stage.

Thank you for all the answers.

Your next question comes from the line of Michael Zaremski with BMO Capital markets. Please go ahead.

Hi, Mike. Good afternoon.

Hey, Rob. Just curious, most of the attention on reserves has been coming from non-commercial auto actually, more recently. You've been showing and talking about kind of commercial auto continue to get increasing rate. Not that commercial auto has been a good guy for the industry in any way, but is there anything we should be reading through that you think the industry still has plenty of kind of issues to deal with, grapple with on commercial auto more so than the other non-auto...

What I'm trying to message Mike and probably not doing a great job, is that I think social inflation doesn't necessarily discriminate between lines. I think it is alive and well, and basically every liability line is exposed to it. That having been said, I think there are some liability lines that seem to be getting more tension from the plaintiff bar than others. From my perspective, auto liability has got the biggest bullseye on its chest. Does that mean Gl gets off scot free? Absolutely not. But that's sort of how we think about it, and that's what the data that we see would suggest.

Got it. Switching gears a bit to the dynamics within the workers comp market. You all have been kind of clear that the profitability. Your view is that it's likely that the soft market is going to impact for profitability. And most of the commentary historically has been more on the severity side of the equation and negative pricing, but I wanted to your peers recently brought up that frequency was becoming a little less negative. I don't know if you also share that view or data that we should be thinking about the frequency component of workers' comp?

I think -- how long can it be so negative for, I think, is an appropriate question. But the piece of the puzzle that we have been most preoccupied with is the medical piece. And from our perspective, the comp benefit schedules in many states has been, some would say, suppressed. Other people would say just benefited from the fact that it prices off of Medicare. Much of it prices off of Medicare. The federal government and how it approaches Medicare pricing, I think we all know, is just a mechanism for them to transfer public cost to the private sector. And comp has benefited from that. But when the day is all done, we don't think that that will happen indefinitely. When you look at other product lines like private passenger auto and you see the shift in trend around medical cost for claims, I think that that would be another data point. Mike, I think as we perhaps have talked about in the not too distant past, you can look to a state like Florida and the action that they took as it relates to benefits. So, I'm sure that it can't be a negative trend with the same pace that it's been on the frequency front indefinitely. But the -- in our opinion, one of the big wildcards out there is medical trend, and we think that that's going to come home to roost.

Got it. And lastly, in your prepared remarks, Rob, you talked about, I might have what you said, I don't have live transcript open, but some resistance allowing carriers to kind of get the rate they need to queue up loss cost trend. I had thought that's more of a personal lines phenomenon, and you're not really much of a personal lines...

My comments were not focused on personal lines, though clearly to your point that it's a real issue for personal lines. We've seen it in certain states where it's proven to be really problematic and leads to a dislocation in capacity in the marketplace or availability of capacity in the marketplace. That having been said, there are many insurance departments in this country that are resistant, that, a, are not operating in a very timely manner and, b, are in some cases quite resistant to allow carriers on the commercial line side to get the rate increases they need. So, when you look at the very healthy flow of business into the specialty market and the E&S market, in particular, which we have been a great beneficiary of and continue to be. Part of the catalyst for that is standard markets are not able to get the rates that they need and consequently that is impacting their writings. And that creates opportunity for organizations like the one that I work for.

Okay. Interesting. Thank you.

Your next question comes from the line of Mark Hughes with Truist Securities. Please go ahead.

Hi, Mark, good afternoon.

Good afternoon. Hello. Rich, you had suggested, I think, in your commentary that the investment income should continue to step up quarter-over-quarter for the foreseeable future. Is that also taking into account the drop-in contribution from the inflation linkers?

Yeah. So, if you look at it on a prior year basis to the 2024 year, we would expect for the foreseeable future an increase in our net investment income.

When you say quarter-over-quarter...

Corresponding period. So, Q2 '24 versus Q2 '23, Q3 '24 versus Q3 '23, yes.

Okay. Got that. And then, the expense ratio in the reinsurance segment, Rob, I think you talked about some chunky investments and technology, that sort of thing. Would one expect the expense ratio in reinsurance to kind of stay at this level of 29% or so?

Yes. But, obviously, a lot of that has to do with scale. So, as we've touched on, I think, in the past, much of the opportunity has been in the short-tail lines. We'll have to see how those opportunities persist. Further, our colleagues, to their credit and their underwriting discipline, have not found as much opportunity on the liability lines. So, is the 29% sustainable? Yeah, but a lot of that will be in part driven by whether the business is able to grow or remain the size it is, or if market conditions were to deteriorate dramatically, then it's possible that could tick up incrementally.

And when you think about growth, you pointed out that E&S has become more prominent perhaps. How much of the growth is coming from that mix shift in the E&S when we think about your top-line?

So, the E&S business is probably growing at, give or take, 50% more than the standard market rate. That's a bit of a generalization.

And is that -- 50%, is that a little bit better than say what it was this time last year, or does that [help put steady] (ph)?

Maybe incrementally better.

Yeah. Okay, great. Thank you.

Your next question comes from Ryan Tunis with Autonomous Research. Please go ahead.

Good afternoon, Ryan.

Good afternoon. How are you? First question, just what are – the cat losses within Insurance, almost $90 million, can you give us a feel of the driver of that? Was it the convective stuff in the US, or [indiscernible] international stuff?

That was primarily SCS in the US, right up the middle of the country.

Got it. And then I guess just on the capital return, I was going to ask how you think between dividends and share buyback, but then I noticed -- I mean, you see you guys doing these specials. But then I noticed that these specials have been almost as predictable from a time of the year standpoint as just the regular divvies. Can you just give us an idea of like why not increase just the common dividend by more and maybe get more credit for that rather than kind of pay these special dividends as though they're regular?

I think it just boils down to flexibility. We're pleased to share the capital with the shareholders, return it to them with consistency. At the same time, we don't know what the opportunity will be tomorrow. We don't know how the stock will trade tomorrow. So, we want to have flexibility as far as growing the business. We want to have flexibility around what we believe is the most sensible way to return capital to shareholders, whether it be repurchase, special dividend, so on and so forth.

Thank you.

Thank you.

Your next question comes from the line of Andrew Kligerman with TD Cowen. Please go ahead.

Hi, Andrew. Good afternoon.

Hey, good evening -- hey, good afternoon, good evening. Friday was a pretty surreal day with that whole CrowdStrike cyber issue.

Yeah.

So, I'm kind of curious, could you frame W. R. Berkley's cyber exposure? And then, with that, what do you make of that for the industry and how it's going to affect the industry, whether it's pricing, loss costs, et cetera?

Well, I appreciate the question and it's certainly a topic that many of us around here have been scratching our heads over just kind of wondering and daydreaming what will come of it as far as market conditions. But when the day is all done, as far as our book goes, we don't -- is it -- will we have perhaps some level of loss activity? Yes, perhaps. But given what we know today, we don't see this being a material loss to the organization at this stage. When the day is all done, to the extent that some type of business interruption is offered, usually, there's an hours clause, if you like, associated with that, and consequently, given when the patch was available and how quickly people, particularly institutions that have some level of sophistication could get back on their feet, we think it'll prove to be manageable. So, I would be surprised if we didn't have any loss activity, but we certainly do not envision this being something of materiality or great consequence at this stage. That having been said, I think for -- what does it mean for the industry, what does it mean for society, I think we'll have to see over time, but I think for many, perhaps it was a reminder or a wake-up call for the systemic exposure that exists around much of the technology that the world uses to operate.

I see. That's helpful, Rob. And just quickly, I mean, as a percent of net written premium, like what proportion of your overall book might that size to?

Less than a couple of percent.

Got it. Okay. And then maybe just shifting back to the commercial auto, 16%, you said maybe all of that growth might have been rate. How comfortable are you with the 2024 book of commercial auto that you're writing? And what does that speak to your reserve adequacy from '21 to '23 on that same line?

Yeah. Look, it's something that we are looking at very carefully. I think that we've -- in our picks, we thought that we are building in appropriately a bit of a risk margin with that period that you just referenced. We'll have to see how much risk margin there still is there, but at this time, we feel reasonably comfortable. That having been said, are we looking at it actively? And are we trying to grapple with how much do we need to charge today with the assumption that trend will continue on from here and when we settle the claims? Yeah, we are focused on it. So, at this stage, are we uncomfortable? No. Are we paying attention to it? Absolutely.

Awesome. Thanks a lot.

Your next question comes from the line of David Motemaden with Evercore ISI. Please go ahead.

Hi, thanks. Good afternoon. Thanks for taking my question. Just had a question on the Insurance segment. So, the accident year loss ratio ex cat was flat year-over-year, increased a little bit versus the first quarter. I was wondering if you could just talk about some of the puts and takes within that? What was driving it to be up versus the first quarter? And just how we should think about that going forward?

Really, just to the extent -- I'm just trying to think for a moment, David. Really, the only big moves that -- and they weren't even big, they were just incremental, but we made in a couple of places, would stem from auto, and they can share that we're staying on top of that. But again, when it comes to the overall, it's pretty incremental. And then, we may have in a couple of places taken a look at the umbrella because, again, how that feeds into -- how the auto feeds into the umbrella, we want to make sure that we don't fall behind there.

Got it. That makes sense. And then, I think, the previous question kind of touched on this too, but I noticed in the 10-Q from last quarter, it looks like, you guys had started to make additional reserve increases to just the other liability line for, I think it was accident year 2020 and '21. It sounded like those were primarily auto related. I guess, I was just hoping to get a little bit more color on exactly what was going on? If you're seeing that happen again here in the second quarter? And then maybe just how you're thinking about that and maybe spreading to general liability and umbrella just non-auto related?

There's no evidence that we see at this time of the issues that we're seeing in umbrella, if you will, spilling over to the other product lines or the issues that we're seeing specifically in auto, I should say, spreading to the other product lines. So that differently, we feel quite comfortable at the moment with the GL. As far as the auto goes, it's a challenging movement. I mean, you drive down I-95 or whatever highway you go down and every other billboard is plaintiff's attorney with their phone number in case a truck cuts you off. And from our perspective, the trend is meaningful, and we need to make sure that we keep up with it. And we want to make sure that the old years are in a reasonable place. And that obviously, as mentioned a few moments ago, has implications, still relatively modest implications, for umbrella. But to your specific question, do we see that sort of some type of viral effect, if you like, spilling over into GL, for example? No, we are not seeing that.

Got it. Okay. That's helpful. And then maybe just a quick one. You had said earlier you guys have gotten 68% cumulative rate since 2019, excluding workers' comp. I'm just wondering, how does the loss trend look versus 2019 if we were just to compare versus that 68% rate increase?

The numbers that we have, it's less than that.

Okay. Thank you.

Your next question comes from the line of Brian Meredith with UBS. Please go ahead.

Hi, Brian. Good afternoon. Good evening.

Hey, two questions for you. The first one, I just noticed professional liability grew this quarter for the first time in over a year. Anything kind of interesting going on there? Or is it getting better? Or just anomaly?

It tends to be what it is, it's what I would define as professional liability ex D&O is having a reasonably good moment and that's both admitted and non-admitted. The challenge as we've discussed in the past and of course you're acutely aware of, Brian, is on the professional front is D&O. So that continues to be a challenged marketplace. A submarket under D&O that I would flag as very, very concerning is transactional liability. And that is a book of business that we have that is shrinking at a very rapid pace just because we don't like market conditions, but as far as the opportunity, it's much of the professional market ex D&O.

Great. And then...

Both admitted and non-admitted.

Thanks for answering. And then second question, you talked a little bit about terms and additions and how that's been a should be a big benefit to profitability going forward on a bunch of this business. Maybe you can give us some examples of kind of what's happened over the last several years in terms of conditions, limits, profiles and that stuff that's going to contribute to the profitability? And I'm assuming that's not factored into that 68% number that you gave us. And maybe how that mitigates any type of development potentially on some of the GL and commercial auto?

Yeah. On the GL side, an example would be that you see a contractor move out of the admitted market where they are buying whatever, $1 million limit or [one-to-one] (ph), and they are paying basically, whatever, $50,000 for the $1 million limit. And all of a sudden the standard market because of loss activity or a variety of other reasons, including they can't get the rate that they need, all of a sudden kicks it out. And then as opposed to being $50,000, it's $150,000, but you get $650,000 of cover and maybe you're doing something with defense and you start sub-limiting all kinds of other things and [indiscernible]. So, it really is very much apples and oranges or maybe even apples and bananas because of what you can do with the terms and the conditions. And that's why if you look at our history as an organization, some of our most profitable business has been what we've been able to write on an E&S basis.

And actually a quick follow-up then. Do you know approximately how much of your business today is E&S versus, call it, 2019 prior to the cycle hardening up?

I don't have the number in front of me, but as I mentioned to your colleague earlier, pretty consistently our E&S business, even putting aside specialty, but just E&S has been growing at a rate for some number of years, it's 50% more than what our standard market business has been growing at. And just to define standard market, a lot of that is admitted specialty. So, I mean the E&S has really been growing quite quickly and provides good opportunity.

Excellent. Thank you.

Thank you.

Your next question comes from the line of Meyer Shields with KBW. Please go ahead.

Thanks. So, some of the questions of [Technical Difficulty], it looks like at least compared to the first quarter, the growth in Insurance short-tail line...

Sorry, Meyer, I beg your pardon, but your line is breaking up a bit.

I'm sorry, is this any better?

A little bit.

Let me try that. I was hoping you could comment on the apparent slowdown in the growth rate of short-tail lines in Insurance?

Sure. It's just a long story short, that's really property and property market. And I think as we talked about some number of quarters ago, the property reinsurance market was what drove the property market. The property reinsurance market has peaked, and no surprise to any of us, the waterfall effect of that is that the property market continues to be good, but the level of opportunity there is perhaps not quite as robust as it was six, 12 months ago.

Okay. That makes sense. Second question I guess in investment portfolio we saw at least on a percentage basis a decent decline in equities, in common equity. Can you comment on that at all?

I'm sorry. Could you repeat that once more?

Yeah. Just the sequential decline in the carry to value of the common stock equity portfolio compared to March 31?

Yeah. We -- did you want to go? We sold a bunch of...

Well, Meyer, we sold a bunch of common stock.

Common stock, yeah.

We just...

We took some gains. We realized some gains.

We just decided that for the -- other than our specialty positions, the stock market wasn't the place we ought to be at the moment.

Okay. Yeah, I just wanted to know if there's any sort of macro view embedded in that.

No, sir.

Great. Thanks so much.

That concludes our question-and-answer session. I will now turn the conference back over to Mr. Rob Berkley for closing comments.

Krista, thank you very much. We appreciate your assistance today and thank you to all for finding time to join us for this discussion. Hopefully, you take away from the dialogue that not only was the company in spite of some of the challenges in the environment to deliver a great outcome, we are also very well positioned. And it's not that there aren't challenges out there, but the business has, is and will continue to do a very effective job in managing the shareholders' capital and making sure that we are achieving those risk-adjusted returns that the capital is entitled to. We will look forward to speaking with you in about 90 days. Thank you very much.

This concludes today's conference call. Thank you for your participation, and you may now disconnect.