Assured Guaranty, Ltd. (NYSE:AGO)
Q2 2008 Earnings Call Transcript
August 8, 2008 7:30 am ET
Sabra Purtill – Managing Director, IR and Strategic Planning
Dominic Frederico – President and CEO
Robert Mills – CFO
Darin Arita – Deutsche Bank Securities
Joseph Timeran [ph] – Piper Jaffray
Brian Meridus [ph] – UBS
Good day, ladies and gentlemen, and welcome to the second quarter 2008 Assured Guaranty earnings conference call. My name is Akiya and I will be your operator for today. At this time all participants are in a listen-only mode. We will conduct a question-and-answer session toward the end of the conference. (Operator instructions)
I would now like to turn the presentation over to your host for today’s call Ms. Sabra Purtill, Managing Director of Investor Relations. Please proceed, ma’am.
Thank you, Akiya, and thank you all for joining us today for Assured Guaranty’s second quarter 2008 earnings conference call. Our speakers today are Dominic Frederico, President and Chief Executive Officer of Assured Guaranty Limited and Bob Mills, Chief Financial Officer. After their prepared remarks, they will take questions from the audience. Please note that our call is not web-enabled for Q&A, so please dial in to the telephone connection of this call if you would like to ask a question.
I would like to draw your attention to a new disclosure that we have made this quarter that provides investors with much greater transparency on our structured finance disclosures and transactions. We stated in our press release that we have posted late night on our website a 21-page list that compiles all the U.S. and international structured finance transactions underwritten by our financial guaranty direct segment that are currently in force and which are not covered by confidentiality agreement. That’s about 680 transactions. There are only a few transactions that cannot be disclosed due to confidentiality agreements, but the par insured amount of those transactions is de minimis, less than 1% of the portfolio. The list includes transaction name and CUSIP, net par outstanding, internal rating, and asset class. We have also provided a note section, which provides additional information on credit enhancement on those transactions that may be outside of the original transaction.
We believe this disclosure will provide investors with the means to look up our exposures on Bloomberg or any other public data source thereby providing you with a very timely data source for your analysis and also as a basis for specific questions to our Investor Relations team on those exposures. Please note that we will update the ratings, par, and new transactions on a quarterly basis consistent with our financial reporting process, but we may update the notes section with explanatory information on an interim basis, particularly based on the questions we receive from investors about specific transactions.
The list itself will indicate that they are the most recent updates, so you will be able to see if there had been additions or clarifications. Also, we do have this list available in Excel form for those investors who would like to sort it by par outstanding or other sorts of criteria such as rating. Please contact the member of our Investor Relations team to get a copy of this spreadsheet, which we will be happy to share. We believe that this list will be a very useful tool for investors and it again demonstrates Assured’s very strong commitment to providing investors with the highest levels of transparency and financial disclosures.
I would also like to note that our 10-Q is accepted on the SEC’s public EDGAR database this morning and is available for your review. You can also get a copy of it in the Investor Information section of our website under Financial Information/SEC Filings.
Finally, I would like to remind you that management’s comments or responses to questions today may contain forward-looking statements such as statements relating to our business outlook, growth prospects, market conditions, credit spreads, ratings and other items where our outlook is subject to change. Listeners are cautioned not to place undue reliance on the forward-looking statements made on this conference call today as management does not undertake to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. You should refer to the Investor Information section of our website and to our most recent SEC filings for the most current information, and for more information on factors that could affect our future financial results and forward-looking statements.
With that I’d now like to turn the call over to Dominic for his commentary.
Thank you, Sabra, and thanks to all of you on the call and webcast for your interest in Assured. I’d like to cover a few highlights of our quarterly results and the credit performance of our portfolio before further discussing the recent Moody’s announcement.
Our second quarter results were very strong especially considering the challenging in the credit markets. First of all, we generated an operating profit as contrasted with continued credit losses at many other companies. On a very positive note, we have record new business production in our financial guaranty direct segment for the second quarter in a row. We continue to build on our U.S. public finance franchise, achieving 35% market share in the quarter.
Our other two direct markets were more affected by the lack of new issuance, but the secondary market activity in these areas helped us grow our U.S. structured finance production by 4% over second quarter 2007, a good result considering market conditions. The strong business production we experienced in the quarter added more than $200 million to our store of future earnings. So we now have more than $2.7 billion of estimated net future premium income, up 66% over the last year, and now stands at roughly 1.16 times our GAAP equity, excluding unrealized losses on credit derivatives.
We have always said that building our earnings and ROE depended on layering [ph] on more years of new business as we were a new entrant to the direct business and many of our competitor had the benefit on their books of business dating back 20 years or more.
Our current ratio, 1.16 times, now exceeds that level that Ambac and MBIA were at in 2005 and 2006 when they were producing consistent ROEs in ranges of 12% to 15%. Our results should benefit even further given our unique corporate structure.
In terms of credit performance, most of the reserves established in the quarter were associated with our U.S. RMBS portfolio. In particular, we established a $23.7 million reserve in pre-tax case loss reserves on our exposure to the American home mortgage asset trust 2007-2003, a closed end second lien deal.
Our other four direct transactions in this sector, which have about $369 million in net par outstanding and are currently rated AA through AAA according to our internal rating standards, are performing within the parameters supported by our credit enhancement levels.
The performance of our other RMBS sectors largely continues to be within the range of our expectations. We posted some HELOC case loss reserves in our reinsurance book, which has $445 million of 2005-2007 vintage HELOCs spread out among 28 different deals. We monitor and evaluate this book in the same way as our direct exposure and utilize the same factors for prepayment rates, delinquency trends, and default rates.
With respect to our direct exposures, we review as always our two Countrywide HELOC transactions very closely. We believe that our range of ultimate losses on these transactions continues to be in the range zero to $100 million after tax. In each of these deals both the dollar amount and percentage of delinquencies and charge-offs appears to have stabilized over the past few months, a favorable trend.
Our pooled of corporate exposure, a concern raised by Moody’s, also continues to perform as we expected, and remains highly rated with limited credit deterioration. That portfolio also includes $2.6 billion in 10 separate U.S. mortgage and re trust preferred securitizations. As you would expect, that portfolio has experienced downgrades and now has an average internal rating of AA versus the original ratings of AAA. The specific rating range of those 10 deals is now AAA to BBB. Current enhancement levels range from 39% to 53% and average 45.7% across the portfolio, providing strong credit protection from losses. And we do not expect to pay any ultimate net losses on these exposures. Additionally, none of these exposures are on our CMC list.
Let me now turn to the subject of Moody’s, which is obviously of the highest priority to us. As we have stated, we are disappointed by Moody’s announcement of their review of Assured for possible downgrade, particularly given that there have been material changes in Assured’s credit performance, earnings power, new business production, capital adequacy, or financial strength, since they last affirmed our rating in March of 2008.
In fact, they commented in May of this year that our first quarter results also do not contain any issues relative to our ratings. Furthermore, they themselves stated that Assured Guaranty Corp.’s capital position exceeds the AAA Moody’s capital requirement, and we would call your attention to the fact that Standard & Poor’s and Fitch have also recently confirmed the exact same situation.
Needless to say, I am upset by their decision, particularly since they have yet to give us specific information as to the basis of this decision.
Aside from general concerns about pooled corporates, a portfolio almost entirely rated by the structured finance group at Moody’s, it seems that they are focused on several industry issues, including the long-term demand for financial guaranty insurance, the anticipated credit performance volatility of certain transaction in the structured finance area, and the lack of financial flexibility and new business production experienced by the troubled companies.
We believe that these issues relate specifically to those companies that reported significant operating losses and do not affect Assured or our capital strength or our claims paying ability, or our market position. In fact, our U.S. public finance business has benefited tremendously from the reduction in AAA rated capacity market wide.
In addition, we have proven our financial flexibility, raising capital at attractive prices to shareholders twice in the last eight months at the height of the market turbulence. Their perspective on the decline in long-term demand for bond insurance is contradicted by the fact that Assured has achieved significant new business growth in the past three quarters, clearly demonstrating that we as a Company are expanding and strengthening our franchise in these difficult times.
We do not intend to be passive observers of the Moody’s credit review process. First, we have communicated our strong disagreement with their statements about our pooled corporate exposures, which total about $42.8 billion or 90% of our portfolio. We are providing them with detailed analysis to support this view, which I would note is well know to Moody’s as they rate 95% of that book and that 84% of our pooled corporate are rated AAA Moody’s own structured finance team today.
There are only two deals, totaling $253 million of par that we rate BBB. The largest one is a $252 million deal referred to as Taberna II and is listed on our transaction list. The deal structure has 39.7% credit enhancement and Moody currently rates it A3.
Overall, we do not currently see any credit issues with our pooled corporate portfolio, which also has well understand and time-tested correlation factors and does have the exposure to mezzanine risk or leverage on leverage that the CDOs of ABS sometimes contain.
We have an active dialog going with Moody’s and are focused on getting a better explanation of what their issues are so we can decide how to address them. I would emphasize that Moody’s continues to state that their review was not a capital issue, so we do not expect to raise capital as part of any potential solution.
As part of our continuing conversations with Moody’s, we had a meeting on Tuesday, this week to express our dissatisfaction with the suddenness and lack of transparency of their review for downgrade announcement. We have always been committed to working with them and have done so for years to address any concerns about our insured portfolio, sector concentration limits, or anything specific to our Company as it affects their ratings, or ratings outlook.
We find it surprising and certainly confusing to all investors who have bought our wrapped bonds that Moody’s would place us under review for possible downgrade without a tangible Company-specific issue particularly after having affirmed our ratings in March.
We worked for more than three years to receive the AAA rating based on their published criteria and methodology. That they would take this action without so much as a discussion, recommendation, cure period, or clear rationale, even though we meet all the established criteria, is in our minds extremely concerning.
Finally, we also believe that there are inconsistencies among the rating methodologies and conclusions of the financial guaranty team and other industry groups at Moody’s. For instance, derivative product companies are still rated AAA even though they have concentrated exposure primarily to one asset class and are experiencing significant new business disruption today even without a downgrade.
Another example is Moody’s comments about our collateralized loan obligations. Whereas their own CLO group published in March an outlook for 2008 and 2009 that stated, “For 2008 Moody’s outlook for CLOs is stable negative with limited rating implication.” Despite the potential for downward rating pressure, we do not anticipate a dramatic change in CLO rating performance. Historically, CLOs have demonstrated considerable rating stability even in the highly stressful credit environment of 2001 to 2002.
I do take great comfort that Moody’s recognizes that we do meet their AAA capital requirements and their statement that we are the only monoline that did so at the recent review. They also stated that our RMBS exposure showed no material deterioration since their last review. I think it’s also noteworthy that we have not reported an operating loss in any quarter since going public more than four years ago, and certainly not this quarter, last quarter, or fourth quarter of 2007, which makes us truly unique in this space.
But despite these facts, Moody’s does not differentiate our performance from the rest of the financial guaranty sector, which in fact is our performance is truly differentiating although our ratings outlook is not.
We are confident in Assured financial strength and are committed to maintaining our ratings. We will continue to work closely with Moody’s as we do with all the other rating agencies, but we still truly are saddened by the lack of clarity and justification, which has caused significant disruption in markets that rely on bond insurance, namely the U.S. public finance market, and also to our shareholders. This disruption will have a negative impact on our third quarter new business production, particularly in the U.S. public finance markets, which is the most rating sensitive, brought on by the uncertainty created by Moody’s.
We have been working closely with issuers, underwriters, and investors to explain that the Moody’s review is not based on our capital of financial strength but rather they are driven by a possible change in their ratings viewpoint on the industry.
In the meantime, there have been transactions that we had previously won that have now gone to market without insurance causing municipalities and ultimately tax payers significant additional expense. Our short-term strategy is to focus on markets where we can have success based on today’s market conditions. Accordingly, we remain very active in the U.S. public finance competitive bid market where demand for our insurance is strong.
Since the Moody’s announcement on July 21st through Wednesday of August the 5th, we have closed 59 transactions at $1.2 billion of par in new issuance secondary transactions.
With that I would like to turn the call over to our CFO Bob Mills, who will discuss the financial results of the quarter in more detail and then we will be happy to answer your questions.
Thanks Dominic, and good morning to everyone. I would like to cover some brief highlights of the quarter. Please refer to our press release and financial supplement for further details on our financial position and results of operation.
Operating income, which we calculate as net income excluding after-tax realized gains and losses on investments and after-tax unrealized gains and losses on credit derivatives, for the second quarter was $38.7 million, or $0.42 per diluted share, compared to $46.7 million, or $0.68 per diluted share for the second quarter in 2007. Our operating income is consistent with the pre-announcement we made on July 21st of 2008.
As Dominic mentioned, the principal reason for the decline in operating income was that we established pre-tax loss reserves on U.S. RMBS exposures written in either insurance or credit derivative form of $39.7 m`, or $0.33 after-tax per diluted share in loss and loss adjustment expenses incurred. These reserves were largely due to the reserve on one closed end second lien transaction, American Home 0703, in our direct segment. The net impact of this case reserve was a $23.7 million pre-tax loss expense in second quarter 2008, or $0.18 per diluted share after-tax.
Our PVP, our present value of gross written premiums for insurance and credit derivatives, totaled $278.9 million for the quarter, up 123%, compared to $125.3 million for the second quarter 2007. The principal driver of growth compared to the prior year was in U.S. public finance, which was $183.2 million for the second quarter 2008, compared to $15.4 million for the second quarter 2007.
Reinsurance PVP was $37.5 million, up from $21.3 million in the second quarter 2007, reflecting stable production in our traditional business and about $15 million of PVP from a facultative portfolio transaction with PMI Guaranty.
Net earned premiums and earned revenues on credit derivatives for the quarter totaled $83.5 million, up 54% from second quarter 2007 with growth in both direct and reinsurance. Based on business we have written through June 30, 2008, we expect net earned premium growth of about 35% for the second half of 2008, compared to the same period in 2007.
Consolidated loss and loss adjustment expenses incurred including losses incurred on credit derivatives and consistent with our previous accounting for loss reserves, totaled $43.7 million for the quarter, compared to recoveries of $9 million for the second quarter 2007. The increase was largely due to reserves for our U.S. RMBS exposures, principally the one closed end second transaction, which I previously discussed.
Credit performance for our guaranteed portfolio has continued to be generally strong during the quarter with limited additions of only $77 million in the quarter to our Closely Monitored Credit list. Post June 30, 2008, the Company’s financial guaranty reinsurance subsidiary commuted a $2.1 billion portfolio of net par outstanding that had been reinsured from XL Financial Assurance. The commutation included approximately $173 million of net par outstanding that was on the Company’s CMC list as of June 30, 2008, including a U.S. public finance transaction and several RMBS transactions. This transaction resulted in a gain of $1.8 million, which will be recorded in the third quarter.
Operating expenses increased by 5% net over the second quarter 2007. The increase in operating expenses is due to added headcount; we have added about 31 new people since the end of the second quarter 2007. The increase in operating expenses was partially offset by lower second quarter 2008 charges for employees reaching retirement eligible age in 2008. These expenses were amortized quarterly in 2007, but were expensed fully in the first quarter of 2008 in accordance with FASB Statement 123R.
For the second half of 2008, I expect operating expenses to increase by approximately 7% net over the prior period due to the additional headcount already hired as well as additional rent expenses associated with new space we leased for our New York operations starting in the third quarter of 2008.
Our tax rate, 3.4% for the second quarter of 2008, is lower than our normal run rate due to tax deduction for the U.S. RMBS loss expenses. For the balance of 2008, I expect the rate to approximate 13%.
Finally, this quarter we had a substantial net unrealized gain on credit derivatives, which was principally associated with the change in the cost of Assured’s credit protection as stipulated under FASB Statement 157. As we have stated in the past, these mark-to-market changes in our financial guarantees written in credit derivative form are not a reflection of our expectations of gains or losses on securities that will be ultimately realized. These contracts are generally held to maturity, hence gains or losses will dissipate as transactions approach maturity absent a credit default.
We believe it’s more informative to analyze our results excluding these unrealized gains and losses. As of June 30, 2008, we had cumulative net losses on credit derivatives of about $1.29 per diluted share, which means our book value per share, excluding this amount, is about $25.95, a 5% increase over the last 12 months, while our adjusted book value excluding the $1.29 amount is about $43.34, an increase of 15% over the past 12 months.
As Sabra mentioned, we filed our 10-Q last evening.
I’d like to turn the call over now to the operator to poll for questions. Operator?
(Operator instructions) Your first question is from the line of Darin Arita of Deutsche Bank. Please proceed.
Darin Arita – Deutsche Bank Securities
Hi good morning.
Good morning, Darin.
Darin Arita – Deutsche Bank Securities
Hi, can you – actually Dominic your introduction there was actually very helpful in talking about the situation with this – the rating agencies. But can you talk a little bit more about your discussions that have occurred over the past two weeks at Moody’s and the other rating agencies?
Sure. Obviously most of the dialog is to do with Moody’s as you can well expect and as recently as last Tuesday we had a meeting at senior levels there and the whole issue that we obviously are trying to understand is how did this happen? Basically, as we see it, the issues that they continue to refer to are really future-looking statements are things about what could possibly happen. Obviously, it would have been our belief that the model that they use to calculate tail logs as in structured portfolio at the AAA level, we have included those kinds of variations or variabilities and potential economic outcome and market outcome and there fore we are confused by that.
Number two, as we have talked about the process and the process being if you have got issues you would hope that they would have been identified. And it seems that they had a clear path in the prior periods as they dealt with other companies in the financial guaranty space in terms of identifying an issue, giving us set amount of time relative to response of the issue and then obviously drawing a rate conclusion at the end of both the time and the potential solutions. And we obviously were given none of that benefit.
So our first concern and foremost was we really are upset by the process and you need to explain how this is part of your process. And then number two, you’ve got to provide us the specifics. We can all talk about the disaster that might be around the corner. That’s like saying none of us would leave our houses because we are afraid we are get hit by a bus if we step off the kerb. Well that’s not reality. So we need to understand why their model doesn’t address those concerns and specifically what issues do you have in our portfolio and as I’ve said through my comments, if you want to talk about pooled corporates, that’s one of the most confusing things to us because it is a book that they are familiar with, that they rate the majority of it, the majority it is AAA. And if you pin them down, they are going to say they don’t really anticipate any losses at the current time coming out of that portfolio. So, once again, we can all talk about economic meltdowns, et cetera, but we need to look at what is the reality of the current situation because obviously we want this corrected. We want our ratings back. We love the Company and the value that we are able to generate in the market.
In terms of the other rating agencies, obviously we (inaudible) and keep very close contact with them and in all cases they’ve recently issued further follow-ups and updates, and as you can see they continue to confirm our AAA stable rating. And in dialog with them directly there is no anticipation at this time that there would be any changes to that. And the normal review that they would normally have as part of their process will take place throughout the rest of the year as you would normally expect.
Darin Arita – Deutsche Bank Securities
Is there any particular information that Moody’s has requested since they put Assured Guaranty on review?
We had a further meeting or phone call with them on Monday where they asked for a lot of information relative to single name overlap in the pooled corporate overall accumulations in any specific asset class. They asked us to give them things like our correlation assumptions that we use on our portfolio. They wanted to look at our top 200 risks and the 200 risk I think is down to about $150 million of net par outstanding. So it’s a pretty low level of detail. So right now, we are obviously cutting down a few forests to provide them all the information that they just recently requested. But once again, frustration on our part, this is information that they have, they always have had. They have had the ability to look at this thing since we were upgraded to AAA last year. There really hasn’t been a seismic shift in the portfolio. If anything, with the current influx of public finance business over the last two quarters, you can see kind of the overall percentages of total portfolio exposed to any given asset class is coming down. So for us it’s all positive news, not negative news. And as we said, we continue to maintain strong operating performance and they are fully aware of the risks that are in the portfolio.
Darin Arita – Deutsche Bank Securities
And to the extent despite your best efforts Moody’s downgrades Assured Guaranty to AA, what would be the strategy there?
Well, I don’t think the strategy changes whatsoever. I think as we look at today and as we talked about the executions that we are still able to complete, the market needs the benefit of our industry and how they secure the financing and get product distribution and support for credit needs across many different borrowers and issuers. There is a part of me that says, and of course I am going to be the optimist because I have go to defend our industry and our Company, that we will just trade through whatever issue they’ve put forward because I think the market has its own understanding and appreciation of what we provide. As we talked about it in the early remarks, we did lose some business to the open market uninsured and we were calculating what was the additional interest cost that they wind up paying because of that, and it’s significant. So there is a real problem that A, they are going hurt long-term liquidity or short-term liquidity, and two, they are going to make everything more expensive at a time when, if anything, efficiency is the definite need of the day. So, this doesn’t help. I think the market will understand that and they will trade right through it.
Darin Arita – Deutsche Bank Securities
Alright, great. Thanks very much.
You are welcome.
(Operator instructions) Your next question comes from the line of Joseph Timeran [ph] from Piper Jaffray. Please proceed.
Joseph Timeran – Piper Jaffray
Good morning. How are you doing?
Joseph Timeran – Piper Jaffray
Good. Could you provide a little more detail on how the Closely Monitored Credit list has changed during the quarter, but – I mean I could see it a little bit but I don’t know if it’s changed within categories, if you’ve moved them between fundamentally sound credits or closely monitored credits. Is there anymore details on that?
There were some – Bob, you want to add?
Yeah, the – I mean during the quarter the – as we said, the overall growth in the CMC list was only $77 million. There was some movement within -- level two actually went down and level three increased as there was movement between those categories during the quarter. It was partially associated with the second lien that we had talked about, the closed end second we report – the reserve that was probably the biggest movement that took place during the quarter.
In most cases the movement from two to three represents the fact that we were carrying a portfolio reserve on those transactions, principally in our reinsurance book and in the most recent quarter on the reinsurance quarter as we got revised the case losses. So in our methodology in term of how the Closely Monitored Credit list works, that moves from two to three.
There were four—in the reinsurance book there were four different credits that went from category two to category three that were home equity loans and that made up most of the difference beyond the one American Home credit.
Joseph Timeran – Piper Jaffray
Okay. Thank you. That’s helpful. And then in your international book, I was wondering if you can provide some color on business there and specifically how Moody’s announcement has affected anything overseas.
Well, obviously we think the announcement has impacted – cut [ph] off the entire market and that’s part of the frustration, and that we feel. In terms of international, much like the U.S. market, you really have a total absence of liquidity. There is no one out there really looking to invest and therefore you are not seeing a lot of new deals coming to market. There have been a couple of restructured deals that we were able to execute in the current quarter. We were basically doing re-packs or on-balance sheet type of risk mitigations, but as you look forward, getting to the question of what business does it impact, obviously the PFI business international, which we had really start to get a lot of activity and enquiries on, that’s going to be hurt by both liquidity and the current Moody’s concern. I think the market is going to step back, let this kind of hysteria work its way through, and then make ultimately their value judgments and we’ll see that business probably come back later on in the year, not early next year, but I think we’ve got an adjustment period that we are all going to have to suffer through because of the uncertainty.
Joseph Timeran – Piper Jaffray
You are welcome.
And your next question is from the line of Brian Meridus [ph] of UBS. Please proceed.
Brian Meridus – UBS
Hey, Dominic, how are you?
Good, Brian, how are you?
Brian Meridus – UBS
Good. Just a quick question, on the secondary market transactions you were doing in the quarter, was there any deterioration as far as what you are able to – the returns you are getting on this business versus obviously in the first quarter, and where they kind of – what was pricing like? Was it pricing at a AA or a AAA, was there any differences in spreads you are receiving on it?
On the structured credit, absolutely not. Obviously, those deals were really providing tremendous assistance in how we get those done. So we stay very strong in terms of both pricing discipline and credit discipline and those deals come with significant subordination and in most cases in the true structure, say the non-ABS side, they were all pre – or the – in the ABS side they were all pre-wrapped. So there are wraps on wraps. On the non-ABS side, more the CDO, CLO side, those things came with significant subordination and strong pricing. Where pricing is an issue, being totally honest and disclosing, is in the public finance market where we really believe it’s in our best interest to keep up activity and issuance and obviously providing insured support on that. So there we have seen a deterioration in pricing that we hope is going to be temporary, but if you really compare pricing levels, obviously we had a current market in the first two quarters that was extremely beneficial from a pricing -- so this kind of brings us back to kind of pre- new market pricing, but I think it’s short term and it’s what we think we’ve had to do to respond to the Moody’s disruption and yet still provide kind of ongoing activity in the wrapped paper public finance market, which we view as critical.
Brian Meridus – UBS
Great. Thank you.
You are welcome.
There are no further questions at this time. I would now like to turn the presentation back to over to Ms. Sabra Purtill. Please proceed, ma’am.
Thank you. Thank you, Akiya, and thanks to all of you for joining us today. I know it’s a busy day with a lot of earnings announcements out there. So please feel free to give myself or Ross Aron a call with any follow-up questions, in addition, Mike Walker and Jason Falzon of our Fixed Income Investor Relations team in New York. We look forward to receiving your calls and answering your questions and wish you a good day.
Thank you for your participation in today’s conference. This concludes the presentation. You may now disconnect and have a wonderful day.
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