W. R. Berkley Corporation today reported net income for the second quarter of 2014 of $180 million, or $1.35 per share. Second quarter highlights included:
- Net premiums written grew 11%.
- Return on equity was 16.6%.
- GAAP combined ratio improved to 94.4%.
- Net investment gains were $109 million.
- Book value per share increased 5.5% to $36.20.
Commenting on the Company's performance, William R. Berkley, chairman and chief executive officer, said: "We were very pleased with our second quarter results. Weather-related losses are typically higher in the second quarter than in other quarters for our Company, and this year such losses were about average. We were able to grow our top line by about 11%. Price increases for our domestic insurance businesses were approximately 4%; thus, for the twelfth quarter in a row, prices increased at a rate in excess of loss costs. We believe that in such an environment our goal should be to grow selectively where the margins are most attractive. We continue to focus on reducing our expense ratio, which declined by six tenths of a point in the quarter.
"We have maintained the quality of our fixed-income portfolio, while at the same time investing an increasing portion of new funds into alternative investments with the goal of generating capital gains. As a result, we have sacrificed some ordinary investment income to achieve the level of capital gains currently flowing into our income statement. Our investment returns from our fixed-income portfolio declined slightly, reflecting both the current interest rate environment and the shortening of our portfolio duration, while other parts of our investment activities have generated attractive returns over the recent period. The sale of a property from our real-estate portfolio resulted in a substantial gain this quarter. We also continue to achieve gains from our common stock and private equity investments.
"We are optimistic that the combination of our operating results and investment gains will allow us to achieve our targeted returns," Mr. Berkley concluded.
About W. R. Berkley Corporation
Founded in 1967, W. R. Berkley Corporation is an insurance holding company that is among the largest commercial lines writers in the United States and operates in three segments of the property casualty business: Insurance-Domestic, Insurance-International and Reinsurance-Global.