Bermuda-based re/insurer Maiden Holdings has reported a fourth quarter net loss of $21.5 million, reflecting the run-off of its previously-terminated AmTrust reinsurance contracts and a tempering of the adverse prior year loss development experienced in recent years.
The company has also closed its re-domestication to Vermont, following a mandatory 14-day publication period as required under Bermuda law.
“The completion of Maiden Reinsurance’s re-domestication to Vermont represents a major strategic step for us as it will continue to appreciably strengthen our solvency ratios and enable us to continue to evaluate our operating strategy during 2020 while leveraging the significant assets and capital we retain,” said Lawrence F. Metz, Maiden’s President and Chief Executive Officer.
Maiden has also posted an underwriting loss of $21.7 million in the fourth quarter of 2019 compared to $232.3 million in the same period in 2018.
Non-GAAP operating loss was $3.5 million, compared with a non-GAAP operating loss of $212.4 million in the fourth quarter of 2018.
Net premiums earned were $35.8 million in the fourth quarter of 2019, compared to $484.9 million in the fourth quarter of 2018 due to the combined impact of the terminated quota share contracts within the AmTrust Reinsurance segment, non-renewals in Maiden Reinsurance’s European Capital Solutions business and a reduction in the German Auto programs produced by the Company’s IIS unit within its Diversified Reinsurance segment.
“We believe that we are positioned to make further progress for our shareholders during 2020. Further, our operating results continue to improve, although the fourth quarter results were impacted by slightly higher non-recurring expenses and it remains a principal focus to lower the run rate of all expenses,” Metz added.
Patrick J. Haveron, Maiden’s Chief Financial Officer and Chief Operating Officer commented, “The fourth quarter results continue to reflect the run-off of our previously terminated AmTrust reinsurance contracts and a tempering of the adverse prior year loss development which we experienced in recent years.
“We believe the LPT/ADC Agreement with Enstar is having the desired effect and will continue to provide adequate limit if further adverse reserve development emerges. While our adjusted book value per share was modestly reduced by fourth quarter results, this non-GAAP measure reflects the ultimate economic value that has been created with the measures we have implemented over the last 18 months.
“As we look to 2020, our strategic focus will center on improving risk-adjusted shareholder returns, whether via asset and capital management or active reinsurance underwriting, or a combination of both.
“Our present assessment of the reinsurance marketplace along with our current operating profile is that the risk-adjusted returns produced by other strategic initiatives may create greater shareholder value versus active reinsurance underwriting.”
