Bermuda-based Maiden Holdings has reported improved net income of $117.6 million for 2021, despite seeing a significant fall in income over the fourth quarter.
Full-year income was up from $80.0 million in 2020, even as Q4 income decreased to $16.2 million, down from $47.7 million for the same period in the previous year.
The improved performance mainly owes to a $62.5 million gain from the repurchase of preference shares that the company reported back in Q1 of last year. Over the full year, Maiden gained $91.0 million from the repurchase of shares, compared to $38.2 million over 2020.
Excluding the repurchase of preference shares, the company’s income would actually have decreased year-on-year from $41.8 million to $26.6 million.
Underwriting income similarly decreased from $17.3 million to $11.6 million, as $27.6 million of favourable prior year loss development was offset by an underwriting loss of $16.0 million owing mainly to the higher loss ratios on the run-off of unearned premium for terminated reinsurance contracts in Maiden’s AmTrust Reinsurance segment.
Net premiums written for the year were $10.4 million, down from $28.4 million previously, with the Diversified Reinsurance segment in particular decreasing by $21.2 million, or 56.8%, due to the return of unearned premiums written in its German Auto quota share reinsurance contract that went into run-off in January 2021.
Investment income likewise decreased by $22.7 million, or 41.5%, primarily due to a decline in average aggregate fixed income assets, which in turn was due to the cessation of active reinsurance underwriing on prospective risks since January 2019.
“We finished 2021 and head into 2022 on a successful footing, positing Maiden for long-term success,” said Patrick J. Haveron and Lawrence F. Metz, Maiden’s Co-Chief Executive Officers.
“During the fourth quarter, we had positive results from our expanded asset management activities and operating expenses continued to trend favourably. We believe our asset management and legacy underwriting strategies will exceed our cost of debt capital.”
Haveron and Metz continued: “As we continue to expand our asset management activities across a range of classes, including private equity, private capital, real estate, venture capital and other classes, we expect this portfolio to produce a range of contributions to our results, including current income, fees in selected instances as well as longer-term gains.”
“The continuing net favourable trends in the run-off of our former reinsurance liabilities continues to track within our expectations but was impacted by higher current accident year losses on the run-off of these liabilities,” they added.
