Greenlight Reinsurance, Ltd. · NASDAQ:GLRE
Greenlight Reinsurance — Greenlight Capital Re — Investor Presentation (May 2009)
14 slides from Greenlight Reinsurance's investor presentation, May 18, 2009
Slide 1: A Differentiated Model with Sustainable Advantage
A Differentiated Model with Sustainable Advantage May 2009 Nasdaq: GLRE
Slide 2: Greenlight Re Vision
Greenlight Re Vision We are a Cayman Islands specialty property and casualty reinsurer with a differentiated reinsurance and investment strategy n Capitalize on inefficiencies in the traditional approach to reinsurance n Generate superior underwriting economics n Derive superior returns from both si
Slide 3: Greenlight Re Model
Greenlight Re Model A fundamentally different, symmetric approach to the reinsurance business Asset Liability Capital preservation on Focus on downside on a deal- investment-by-investment basis by-deal basis Concentrate on best Fewer, bigger deals that are investment ideas important to our clients a
Slide 4: Len Goldberg, CEO; Bart Hedges, President & CUO; Tim Courtis, CFO
Len Goldberg, CEO Kerry Berchem Bart Hedges, Mandy Vodak-Marotta Tim Courtis, CFO General Counsel President & CUO Operations Manager (Partner, Akin Gump) Brendan Barry Rene Shortridge SVP Office Administrator Nadia Dilbert VP Actuary Sherry Diaz Faramarz Romer Underwriting Assistant Open Controller
Slide 5: Underwriting Philosophy
Underwriting Philosophy Lead underwriter for majority of transactions Generalists with flexibility to look at a wide range of opportunities Rigorous modeling combined with practical underwriting experience Each contract stands on its own Incorporate risk-aversion into pricing Focus on transaction ec
Slide 6: Cyclical Opportunities
Cyclical Opportunities Source: National Association of Insurance Commissioners (NAIC) Annual Statement Database. 5
Slide 7: Investment Program
Investment Program n Deep value, long/short primarily equity with cyclical debt exposure n Historically approximately 80-100% long, 20-50% short q Currently near the conservative end of the range n Above market returns with less volatility than the major stock indices over the last 13 years n Constr
Slide 8: Compensation Framework
Compensation Framework n Align management and shareholders n Compensate for true increase in economic value, not for premium growth, GAAP accounting, irrational exuberance or “fully deploying capital” n Cash Bonus Program: q Track economics of every contract individually q No bonus when underwriting
Slide 9: Risk and Capital Management
Risk and Capital Management n 2008 premium to capital ratio of 0.3, anticipated to increase as portfolio develops n Low leverage play: q No corporate debt q Low premium-to-capital and reserve-to-capital ratios q Frequency business orientation n CEO and CFO review reserves by account every quarter 8
Slide 10: Book Value Growth
Book Value Growth 7.9% CAGR in fully diluted book value per share since inception $ in millions $ per share Composite Ratio1 NA 75.5 84.5 94.1 Combined Ratio2 NA 109.6 96.5 103.6 Capital and Surplus3 221.0 312.2 491.4 520.5 Invested Assets/Capital 99.0% 105.9% 118.5% 120.1% Notes: 1. The Composite R
Slide 11: Current ROE Sensitivity
Current ROE Sensitivity Assumptions: Earned Premium = 20% of capital Invested Assets = 120% of capital Combined Ratio (%) Investment Return (%) —;SREENLIONT 10
Slide 12: Hypothetical ROE Sensitivity
Hypothetical ROE Sensitivity Assumptions: Earned Premium = 75% of capital Invested Assets = 175% of capital 11
Slide 13: Why Greenlight Re?
Why Greenlight Re? Differentiated, symmetric approach Low leverage model with significant upside potential A- rating from A.M. Best with ability to invest 100% in equities Proven underwriting and investment capabilities Uniquely positioned for current market conditions = Sustainable Advantage 12
Slide 14: Slide 14
Greenlight Capital Re — Investor Presentation (May 2009) on 6ix