Insurance Sector Actionable Intelligence

I have performed some more digging in the insurance sector, basically looking for the next  AIG (AIG), and although I am far from finished, I thought I would drop a note to the professional level subscribers that extended the general insurance note that I released last week. You may download the note here. In addition to the professional level subscription, you will need Adobe Acrobat Reader version 9 or higher to view this.

Here are a few highlights (keep in mind that the details are reserved for the download):

• As a result of the continuing financial crisis, the company is recording significant unrealized losses as a result of mark to market adjustment of the general account securities (the portfolio on which the company assumes the credit and the market risk).
• The net unrealized losses on these securities rose a deafening 550% to 5.2% of the cost as of June, 2008 against 0.8% as of Dec, 2007.
• As of June 2008, the risky components of $77.6 billion dollar portfolio included $2.04 billion of sub prime RMBS, $2.6 billion of equity securities (79% relates to financial services sector), $15.7 billion of CMBS, $11.7 billion of corporate bonds issued by financial services sector and $2.9 billion of senior secured bank loans CLOs.

Comments

[Fish Gone Bad:]

The markets are a bloodsport. Reggie, you are a gladiator. I am impressed.

Clark Jenkins
FishGoneBad.com

2008 Oct 21 01:13 AM

[Reggie Midd...:]

Well, thank you sir. Let me channel Russel Crowe in his best role ever, "Are you not entertained??!!"
:-)

2008 Oct 21 02:26 PM