濱特爾 (RNR) 2008 Q1 法說會逐字稿

Good morning. My name is Rich, and I will be your conference operator today. At this time I would like to welcome everyone to the RenaissanceRe first quarter 2008 financial results conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question-and-answer period (OPERATOR INSTRUCTIONS). Thank you. It is now my pleasure to turn the floor over to David Lilly. Sir, you may begin your conference.

Good morning. Thank you for joining our first quarter 2008 financial results conference call. Yesterday, after the market closed we issued our quarterly release. If you didn't get a copy please call me at 212-521-4800, and we will make sure to provide you with one. There will be an audio replay of the call available at 2:00 PM Eastern time today through May 14 at 8 PM. The replay can be accessed by dialing 800-642-1687 or 706-645-9291. The pass code you will need for both numbers is 43078699.

Today's call is also available through the investor section of www.RenRe.com and will be archived on RenaissanceRe's website through midnight on July 11, 2008. Before we begin I am obliged to caution that today's discussion may contain forward-looking statements, and actual results may differ materially from those discussed. Additional information regarding the factors shaping these outcomes can be found in RenaissanceRe's SEC filings, to which we direct you.

With me to discuss today's results are Neill Currie, Chief Executive Officer; Fred Donner, Chief Financial Officer; Kevin O'Donnell, President of Renaissance reinsurance Ltd.; Bill Ashley, President and Chief Executive Officer of Glencoe Group Holdings Ltd. and Todd Fonner, Senior Vice President, Chief Risk Officer and Chief Investment Officer.

I would now like to turn the call over to Neill.

Thank you, David. Good morning, everyone. I am pleased to report another quarter of strong financial results for RenaissanceRe. I would like to frame this quarter's results in the context of our strategy, which has been consistent throughout our history. The first element of this strategy is to maintain strong underwriting discipline in both hard and soft market cycles. We are committed to stable, consistent, exposure-based pricing and that has been the foundation upon which we have built our strong client and broker relationships. This commitment to discipline is integral to the performance we have achieved over the past fifteen years.

Also integral to this strategy is taking advantage of the opportunities we have in soft markets to invest in our franchise, look for new opportunities and as appropriate return capital to shareholders. This strategic focus has enabled us to deliver superior value to our customers and shareholders during the various market cycles that have occurred since our formation in 1993. Today our strategy is helping us navigate through the turmoil in the capital markets in addition to the softening underwriting environment. Our disciplined approach to our business, combined with minimal catastrophe losses, enabled us to achieve a 51% combined ratio and a 21% operating return on equity this quarter.

The light loss activity and profitability our industry has enjoyed over the past several quarters has put some pressure on pricing. We expect to reduce our top line in this kind of environment. But given our excellent tools and talented underwriters we know it is possible to put together a strong portfolio of attractive business. Our reputation for responsiveness, creativity and fair dealing help us to keep and obtain the business that we find attractive. So all in all we feel good about the quality of our book of business and what we see in the pipeline.

As we continue to execute on the blocking and tackling, we are taking important steps to strengthen our franchise and position ourselves for future growth. We recently acquired Claims Management Services, a privately held provider of claims services and this is significantly strengthens our internal organization. We also agreed to acquire Agrinational, which is a premier program manager of crop insurance. This acquisition increases our opportunities in the agricultural marketplace.

We have also recruited and continue to recruit talented executives to support our entrance into attractive new markets and build our businesses in existing markets. And our ventures unit was integrally involved in the Agrinational acquisition and continues to be active in sourcing new joint venture opportunities.

We are tracking legislative proposals surrounding the Florida market. And Kevin O'Donnell, who is with us on the call today, will comment on that in more detail in just a moment. Briefly, while we are encouraged that the benefits of the private markets are being recognized, we acknowledge there are complexities and challenges surrounding this debate. As we monitor these developments, we continue to research and promote risk management or risk mitigation, rather. We believe that widespread use of effective mitigation in catastrophe prone areas is likely to have the greatest impact on protecting families and properties and on reducing the overall cost of insurance.

Switching to investments, from an investment standpoint we are comfortable with how our portfolio is positioned, especially in light of the recent turbulence in the capital markets. Our goal is to deliver above-average returns on our underwriting book while remaining relatively liquid and less volatile in our investment portfolio. We seek to balance risk and reward and in light of the conservative risk profile in our portfolio are pleased with the 1% total return we generated this quarter. Investments are certainly on everyone's minds these days. So I am pleased to say that Todd Fonner, our chief investment officer, is on the call this morning and available to answer questions.

So in summary, I feel good both about our performance in a softening underwriting environment, as well as our progress in positioning our Company for future growth. And with that, I'll turn the call over to Kevin to discuss our reinsurance operations.

Thanks, Neil. I will start with the overall cat market and then move into Florida more specifically, which is where we are spending most of our time right now. As we discussed on a previous call, after several years of growth the overall US market has really stopped growing, which is having the expected effect on pricing. Although that is generally true, Florida is discussing legislation that would reduce the FHCF and potentially increase demand for private market reinsurance. We monitor all the legislative initiatives in Florida very closely, as they can have a significant impact on the way in which we build and shape our portfolio.

To better understand the impacts of these changes we have stress test our portfolio and have made adjustments on a pro forma basis to represent the impact of any potential legislative changes. All in all we remain comfortable that we will have an attractive portfolio, whatever the outcome. As far as reinsurance supply, the private reinsurance market has significant capacity to respond to any of the proposed changes. So I don't have -- don't expect any dislocation, and the market should remain orderly. It is our belief that because of our market positions and our overall relationships in Florida, if the proposed legislation is adopted, we are well positioned to capitalize on the changes.

With regard to pricing in Florida, it is still very early in the process, and we want to be careful not to set expectations too high. Florida is a unique market, and although many of the proposed changes may appear to increase demand, due to the structure of the market not all the increase in demand will transfer directly to the private market. Having said all that, we don't expect to see material impact with or without legislative changes on our portfolio in Florida.

Moving outside the US, we saw moderate deterioration of the international markets over the quarter. And although the reductions were not large on a percentage basis, in some cases they moved deals from acceptable to unacceptable and we had to exit them.

On the retro side as we discussed many times this is not a particularly efficient market, and with that said, it is sometimes difficult to categorize the market one way or another. We are an active participant in the market and seeing opportunities both inwards and outwards and have added to the portfolio as appropriate.

On the specialty side we are continuing to see aggressive pricing in many lines of business which we are currently anticipating. We are spending a lot of time looking at new products and markets to seek new opportunities to lower capital but have not yet identified any new areas from a reinsurance perspective that warrant committing additional capacity. However, we continue to monitor certain markets where we believe there is an increased likelihood of dislocation due to heightened loss activity or a sense of increased risk in some lines of business.

Thanks, and with that I would like to turn the call over to Bill Ashley.

Thank you, Kevin, and good morning. It has been a very busy but exciting quarter for the first -- I'm sorry for the first quarter for the individual risk unit. As Neill mentioned earlier in softer stages of the cycle we have focused historically on underwriting discipline and building out our infrastructure. And you can see this strategy very much in evidence this quarter. We have been diligent about maintaining the quality of our book, sourcing the best in the business and exiting accounts that do not meet our requirements. We were pleased to announce the signing of a binding letter of intent to acquire Agrinational, our program partner for multiperil crop business for several years. This transaction will give us a first-class platform from which to operate in the agricultural insurance business.

We have been writing this business for several years now, and we see the agricultural space as a long-term franchise for us with great potential for future expansion. The multiperil crop business fits very well with our analytical and data driven approach to underwriting and is diversifying for Renaissance. In addition, we believe we would be able to leverage the modeling, scientific and climatological expertise within our organization to great effect in this space. The Agrinational management employees will continue to stay in place. They have a proven track record of being among the best in the business, and we could not be more pleased that they will soon be joining the Renaissance family.

We were also pleased to announce the acquisition of Claims Management Services this quarter. CMS has been our third party claims administrator for several years, handling a significant portion of our property and casualty reserves. They have done an outstanding job for us and have proven expertise abilities as claims management organization. CMS has approximately 55 personnel who will now make up the Glencoe claims service group and will be based out of Atlanta. These two acquisitions will give us greater certainty and control over operations and distribution, which will contribute greatly to our profitability.

We are still seeing opportunities to write hurricane exposed commercial property business. The upcoming months of May and June are very heavy renewal months so we will have a better understanding of whether the market is going to remain disciplined at the end of next quarter.

Just a quick bit of background on the results for the quarter, which Fred will discuss in detail in a minute. We typically expect the first quarter to have slightly higher combined ratio than for the full year due to some seasonality in the program business. The combined ratio for this quarter was entirely within our expectations.

In summary, we continue to build for the future. We have been pleased thus far with our ability to navigate today's softening market conditions while strengthening in infrastructure and talent we need tomorrow. Thank you, and I will now turn the call over to Fred.

Thanks, Bill. And good morning, everyone. After the market closed last evening we reported operating income for the quarter of $148 million or $2.21 per share. We achieved the 21% annualized operating return on common equity and grew our book value per share by almost 3%, including the impact of our share repurchases. Overall, our top line declined by 17% for the quarter, driven primarily by our disciplined underwriting approach in this softening market.

However, our underwriting profits remain strong, and we generated a 51% combined ratio, benefiting from another quarter of low-level of insured events. Let me move onto the segment operating results, starting with the catastrophe unit of our reinsurance segment. Our catastrophe unit generated gross written premiums of $364 million as compared to $399 million for the same period last year. On a managed basis our premiums are down about 7%, which is in line with our full year forecast of down approximately 10%.

Underwriting income during the quarter for our cat unit amounted to $123 million, up from $74 million for the same period last year. This period's results were favorably impacted by our lower level of current year losses compared with last year's results that, as you may recall, included the impact of windstorm Kyrill. Our expense ratio is 11% versus 18% last year, driven by a decrease in acquisition expenses resulting from higher profit commissions on ceded business. Overall, we generated a combined ratio of 29% versus 63% for the same period last year.

In our specialty unit gross premiums written was $80 million versus $117 million last year. The decrease results from continuing softening and our decision not to renew certain contracts given the present market conditions, in addition to certain clients electing to retain more risk. While we still believe our full year gross premiums written in this unit will be down approximately 25%, there is some uncertainty given the fact that specialty is impacted by relatively small number of large transactions. For the quarter underwriting income was $23 million versus $42 million last year. This year's results reflect the higher level of current year losses and a lower level of favorable loss development.

Our individual risk business unit produced gross written premiums of $81 million compared to $123 million for the first quarter of '07. The decline is a reflection of our decision to reduce participation on certain commercial property and personal property reinsurance treaties last year, combined with overall softening market conditions. Individual risk segment top line is somewhat lumpy, and with the addition of two new programs late last year and the anticipated growth in our multiperil crop business, at this time we continue to feel comfortable with our top line forecast of down 5% for the full year.

Favorable development amounted to $22 million this quarter, of which $16 million relates to the 2007 crop year. We closed out our 2007 crop year this quarter and it came in a little better than expected, adding about $3 million to underwriting income. Our results reflect this on a gross basis as favorable development of $16 million offset by about $12 million of ceded earned premium.

Turning to investment results, it was a fairly choppy quarter in general for the fixed income and equity markets. Recognizing the volatility in our underwriting business, we try to keep things less volatile in our core investment portfolio. For us, managing our overall risk portfolio means taking into account the risk on both sides of the balance sheet. As Neill mentioned, overall given the market conditions we are fairly happy with the way the portfolio held up, returning just under 1% for the quarter. We've added to our financial supplement a more detailed breakout of our investment returns.

As you can see, our hedge fund and private equity investments were down slightly for the quarter, which is quite a contrast to last year's exceptional first quarter. While this quarter's results were disappointing, we believe these allocations will deliver strong risk-adjusted returns over the long-term. You may have also noticed the negative returns in the other category of other investments. These are predominantly high yield investments where we hold shares in a fund structure. So we classify them as other investments and net investment income includes both realized and unrealized market value changes on them. A large portion of these are in bank loan funds, which had a tough first quarter but which we believe offer good risk/reward profile going forward.

Lastly, we've added some additional disclosure to our earnings release on our securitized asset holdings as of the end of March. We've disclosed in the past our holdings by rating but recognizing that there is a broad spectrum of securitized assets rated AAA we provided some additional detail this quarter. As you can see, we have selectively added to our holdings of highly rated securitized assets over the last 12 months, taking our allocation to MBS and ABS from 13% to 28%. But we have been deliberate in terms of where we have invested. We only own AAA rated tranches. Our investment portfolio is not positioned to have direct subprime exposures, and we do not directly hold CDOs or CLOs. We have not directly invested in any home equity loan sector, and we have not purchased securities wrapped by financial guarantee companies.

Roughly 70% of our MBS exposure is to agency mortgages, and we have a balanced distribution across vintages. In CMBS and non agency mortgages 60% of what we own is 2005 vintage or prior. In terms of the overall portfolio, we remain conservatively positioned with over 90% of the portfolio rated AA or higher. We are also continuing to maintain a shorter duration of just under two years, and we are comfortable with the expected risk/reward construction of the portfolio. In these volatile markets we believe we are well positioned to expect adequate returns with an appropriate risk-adjusted basis.

Let me turn now to income tax expense. As you all know, we have incurred $8 million of tax expense this quarter. During the first quarter last year we maintained a valuation allowance relating to our net deferred tax asset. As a result, tax expense was reduced last year by a reduction in that allowance. At year end 2007 we substantially reduced the valuation allowance as we are profitable in the United States, and our financial statements are now reflecting the income tax expense incurred by our profitable US operations.

And lastly, during the quarter we purchased approximately 4.3 million common shares at an aggregate cost of approximately $240 million. Since we began our program in the first quarter of 2007 we have repurchased approximately 8.3 million shares, representing about 12% of our outstanding shares. Our philosophy around capital management has not changed. We will continue to manage capital appropriately across the market cycle, and we will continue to buy back our stock when we believe the prices are attractive.

Thank you, and with that I will turn the call back over to Neill.

Thank you, Fred. Operator, let's open it up to questions now.

(OPERATOR INSTRUCTIONS) Brian Meredith, UBS.

A couple questions here for you. First, Kevin, I wonder if you could talk a little bit about HB 983 in Florida. It is actually the windstorm insurance coverage bill. What impact if that bill does happen to go through, would it have on the property cat reinsurance market do you think, and what likely likelihood do you think the bill could have going through?

You're talking about the (inaudible) bill I think, right?

Yes, they call it the windstorm insurance coverage bill. Yes, exactly. It is not the cat fund bill.

There is a bunch of features to that bill. The one that some of which I think are actually -- let me address it from the reinsurance perspective. From the reinsurance perspective the one that is most likely to have an impact on our market is if they do the surplus notes for $250 million and then the matched funds. Because if you break that all out within a couple years they are supposed to be writing 6 to 1 against that money. So that is matched funds. The 250 becomes 500. 6 to 1 becomes $3 billion of premium. With move into takeout companies for [asific] If that were to happen, the potential for additional reinsurance purchases is pretty significant. So I think there is an element there that from the reinsurance perspective there could be an increase in demand coming from companies taking to the view as the matching funds.

With that on the insurance side it can lead to potentially significant price competition, because all this capital needs to be fed from basically from the Florida market. A bunch of other features in there as far as whether million dollar homes are covered and things. But the main impact really comes from that one element of the bill as far as the reinsurance company. So it could have a --

Actually I think I am talking about a different bill. This is the one that creates a windstorm facility inside the FHCF basically to pick up all wind exposure.

Okay.

We can talk about it later.

Okay, yes, I think we are not sure exactly which bill that is.

It is HB 983, if you want to know. It is called the windstorm insurance coverage bill. Actually the second question, a big drop in cat bond investments in the quarter. Any particular reason for it?

No. Again, we look at cat bonds very similar to the reinsurance business, and so from as far as our appetite for them it is consistent with what it has been. It is just a matter of whether the bonds that are currently available fit our portfolio. As far as the specifics on what the changes are, I will flip it over to Fred.

There is a couple things going on there. First thing is we have a total return swap in place for our cat bonds, which provides us with liquidity. The accounting for that is a shift from other investments in cat bonds to a line item on our balance sheet called other securitized assets. So I think when you are thinking about acquisition in cat bonds you have to take that line into consideration. But having said that, in addition to that there was some activity in the cat bond area this quarter; we did have about $48 million of maturities coming due. But we also took on about $17 million of additional cat bonds. So it's not like we are selling them. We did have some short-term ones that matured. And for liquidity purposes we have entered into a total return swap.

And last question is, if I look at your other income expense line there is a big other income this quarter versus we've been seeing some fairly large expenses there. Anything unusual this quarter?

A large component of the other income line this year is a $13 million swing in trading gains realized from our weather trading activities. What we do there is we have a group that does weather-related trades, energy and weather-related trading activities linked to things like heating and cooling degree days and energy production. It is a relatively small group. It is seasonal. They had a pretty good first quarter. So that is the one difference coming through this quarter.

Great. Thank you.

Tom Cholnoky, Goldman Sachs.

Thank you. Can you just -- I just want to clarify a couple things. Number one, the other loss of $14 million investments, $14.4 million in the quarter, exactly which if I look at page 10 of your release, which funds would that get allocated to, or which types of investments?

The hedge funds and the private equity are identified as hedge by the private equity, and everything else you're seeing in the schedule for other investments is rolling through the other stuff. So it is senior secured bank loan funds, some non US fixed income funds which are primarily high yield cat bonds and then some miscellaneous other investments.

Is it kind of prorated by asset size?

Yes, -- well, you've got the size of the assets in the schedule, and then the $14 million in terms of how it is spread out, the stuff that is high yield had a rough quarter. So that is the majority of the loss.

Okay, okay. And then just maybe a little bit more clarification on the tax rate, Fred. What kind of guidance would you give us on that? I know it is tough depending on where your losses occur, but if you have another clean quarter in the second quarter without much loss, should we expect the tax rate in kind of that 4 to 4.5% range? Because that seems to have jumped up pretty high.

Let me give you a sense for where the tax expense is coming from. It is being driven primarily by the trading profits from our weather and energy derivatives trading group, which I just mentioned. So again, a seasonal business. While we like the profits, I don't think we expect those profits going forward. And as such, we don't anticipate significant tax expense going forward either.

Okay, why would these guys be trading in Bermuda?

Why wouldn't they?

Aren't they trading in Bermuda? Why would there be a tax on this then?

No, they are trading in the United States.

Okay, if they keep making money maybe you should move them.

I will make a note of that. Thank you.

And then -- and once again I apologize -- so basically we should think about this other income line as kind of going back to a more normal loss scenario in the next couple of quarters? Is that what you are saying? I mean, these are -- a little surprised. Don't you expect these guys to make money, or are they just making outsized amount of money?

Again (multiple speakers)

I assume you are not trading for a loss.

No, no. These guys do client origination trades, and a lot of it is hedged. And they really had an exceptional quarter. So while we do expect them to make profits, this was a very good quarter. Going forward there is a lot of moving parts in the other expense, other income line. And it is pretty clear that I wouldn't expect $13 million of income to continue to come through, particularly in the near-term.

Okay, great. Thank you.

Jay Cohen, Merrill Lynch.

My question is are you seeing either a big difference or a change in difference between the pricing in the cat bond market, which seems to have grown dramatically, and the more traditional reinsurance market?

One thing is they tend to be at different levels oftentimes where the reinsurance market is participating below the cat bond market. I think over time we have seen cat bond spreads. They look at the cat bonds are looked at largely as a multiple of expected loss, and that multiple has reduced a bit. From a -- which can obviously be transferred to a loss ratio. From a loss ratio perspective then cat bond loss ratio have gone up a bit. But so with the market moving the way it is in the reinsurance, reinsurance rates are decreasing. So you're getting higher loss ratios there, as well. So I think yes, we've seen movement but on a relative basis it hasn't been one moving much more extreme than the other.

That's helpful. Thanks.

Alain Karaoglan, Banc of America.

A few questions. Fred, on the other income line, so you had $13 million of profits from that. The other income line was $8 million. Is the difference what would be a normalized rate, or is there any way to think about that going forward? A negative 4, or negative 5.

That is probably still pretty high. Again, what I focused on was the biggest component of it is things going both ways. So I would say if you look back over time and you average it out you will probably get a better run rate over the long term. There is a lot of detail in there that will provide you in our 10-Q. I will be happy to take you through the details after the 10-Q is out.

Okay. The next question is on your AOCI went from a gain of $44 million to a gain of $65 million in this environment. What is leading to that and could you go through whether you account for things differently?

Yes, one of the things that we do that might be different than some others is that we take our OTTI, our unrealized losses through income. So we realize the unrealized losses. So all you see in the OCI is the unrealized gains.

Okay, and in terms of the other items that Todd mentioned in terms of the investment portfolios losses from the other investments, you mentioned it is coming from the high yield. Is that -- that would be the non US fixed income funds that you were referring to?

It is the bank loans and the non US fixed income. That is almost entirely high yield, which as you know had a rough first quarter.

The bank loans are high yields, as well, or high-grade?

It is senior secured bank loans. Most of them are high yield.

Okay, thank you very much.

(OPERATOR INSTRUCTIONS) Vinay Misquith, Credit Suisse.

Good morning. I was wondering whether you could elaborate a little bit more on the Florida impact. I think Kevin said that the private reinsurance market has a sufficient amount of capacity and you see no material impact with or without the legislation on your premium growth. So trying to reconcile that with the down 10% top line in the property cat division that you had before, and trying to see what we have some upside or what is the upside should that legislation go through.

There is a couple features in Florida. I touched a little bit on the Atwater bill. The other one that people are speculating on is whether the reduction in TICL will go through, which there is a lot of legislation being discussed as to having a $3 billion reduction to the TICL layer, which sits above the FHCF. Those changes, when you walk it all through the way the market is set up between other public entities and some large players who purchase reinsurance; again it doesn't all come to the private reinsurance market. So the combination of the increase there, some changes in private market buying habits and the generally the kind of healthy supply of Florida capacity right now, I think there is a lot of balancing influences that will come to play, no matter what the changes are so that come through. So that is the reason we are saying it is not going to be a massive change to how the market behaves in the very near-term or for this renewal.

Fair enough. Do you still maintain a down 10% or do you think there could be some slight upside to that?

I think, again, it is early days as to how the market is going to shake out, as far as whether people are going to buy additional lower layers or but I would say at this what it is fair to hold us with the guidance we already gave.

Fair enough. And on the reinsurance purchase that is on a retro purchase, they seem to have ticked up this quarter in your reinsurance division; plus you also seem to have bought more reinsurance on the primary insurance division. I am just curious as to whether you are buying more reinsurance now that the market is softening.

I think inwards and outwards retro really is just tools that we use to optimize our portfolio. If the pricing is right, we will write the deal. A lot of times it is in the gray area where we will do nothing. And if we think by adding it to the portfolio it enhances the overall return of the book, we'll buy it. That philosophy hasn't changed. We have seen some opportunities actually to write a few deals and to buy a few, often in different territories. And then we've had some -- I think that will continue to go forward, but I wouldn't say that there is a change in philosophy as to how we are looking at retro at this point, that needs to be highlighted at this time.

Finally, on the specialty reinsurance side, I believe the accident year combined ratio was 102%. I was just wondering if you could shed some light on that. Was there some onetime items in that?

It is not something that I would look to have as a trend in the book. We put up some -- it has been a pretty active risk loss quarter. We put up some reserves for some risk losses. Other than that, there is not much that I would identify for that book. And as far as the specifics on how it was a reported if Fred wants to add something.

The only other thing that is slightly driving that up is you will note an increase in the expense ratio. As you may recall, last year we entered into a large quarter share deal, and that generally carries a higher commission rate than the traditional business in the specialty book. So that is causing an increase in the expense ratio, as well.

Thank you.

Chuck Hamilton, FTN Midwest.

Good morning, everyone. The question for I guess Kevin, it follows on from the previous question in terms of the reinsurance purchase in the catastrophe business. It seems like your retention has typically been in the low 90s in the first quarter of the years in terms of retaining the reinsurance gross written, and now we are down to 72% this quarter. Do you anticipate -- again what I think I heard was an opportunistic purchase of outward reinsurance this quarter. Do you expect to get back toward more historic trends in past year?

I don't know. Will really depend on -- we don't necessarily look at what percent of the premium we are spending. We look at what percent of the premium we are making. And if overall by adding retro and it changes the ratio of what we are ceding increases the expected profit, we're going to do it. As far as the overall market, I think at this time in the cycle there tends to be more opportunities to purchase reinsurance. But I wouldn't want to forecast that that is what we're going to see on a going forward basis. But if the opportunity is there, we will continue to buy.

Okay, thank you.

Thank you all for joining us today. In closing, let me say that I am really happy with the position we have in the market right now. We've got a disciplined, talented team. We are laying the foundation for the future, and we've got a great portfolio. So thanks for joining us, and we will look forward to talking to you next quarter.

This concludes today's RenaissanceRe first quarter 2008 financial results conference call. You may now disconnect.