Question-and-Answer Session
Operator
(Operator instructions) And your first question comes from the line of Craig Siegenthaler with Credit Suisse. Please proceed.
Craig Siegenthaler – Credit Suisse
Thanks and good morning. Can you give me some feedback from the rating agencies, I'm just wondering what their reaction was at the first quarter mark, and if there is any risk that they essentially change the economic capital? Maybe not due to anything that Primus is doing or maybe say the marks that you guys have, but more so due to potential marks that some of your competitors or potential risks and defaults over there.
Tom Jasper
Good morning, Craig. Certainly we can't tell you what the rating agencies are thinking, but certainly in our conversations with them we have certainly talked about the issues around our GAAP number. And we certainly informed them as to what our first quarter results look like and there has been no comment. We think we feel very good about what both S&P and Moody's said during the first quarter in their reports regarding their views on mark-to-market and GAAP earnings as it relates to capital models, and it’s very consistent with what we discussed in the call today.
Craig Siegenthaler – Credit Suisse
Based on where a lot of these assets, especially the corporate spreads have gone thus far in the second quarter. It's looking like you are probably going to be very positive mark in the second quarter if everything ended today?
Richard Claiden
I think we are actually seeing a reduction in the negative mark-to-market. So in terms of the change in the mark I cannot speak to where the marks will be at the end of the second quarter, but we certainly seen so far in this quarter an improvement or a lessening in the negative mark. So, in terms of the change from quarter to quarter, we would expect to see if things continue as they are, a positive GAAP result in the second quarter.
Craig Siegenthaler – Credit Suisse
Got it, and just to check on the ABS business. I asked this question last quarter. When you exited this business, you wrote a lot of business two quarters ago. You exited due to some high losses. Do you see any opportunity there in some of the higher level tranches or some of the earlier vintages? When you look at the businesses, though, if there's money being made, it seems like that’s probably the area where there is probably high risk but high reward in some areas?
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