Question-and-Answer Session
Operator
(Operator Instructions) Our first question is from Bijan Moazami with FBR
Bijan Moazami - Friedman, Billings, Ramsey & Co.
I have a couple of questions for Ron and a couple of questions for Barry. Ron, did you have any kind of reserve release this quarter, a and b could you tell us what percentage of your invested assets now is in the common stock.
Ronald E. Pipoly, Jr.
In terms of reserve releases, no, we did not have any prior year reserve releases. The decline in the workers’ compensation loss ratio in the fourth quarter was a result of our ability to reset our ultimate loss projections for accident year 07. So as the year progressed we saw positive development in our loss trends for accident year 2007 and were able to lower our projections in the fourth quarter. And in terms of the investment portfolio, right now about 6% of our invested assets are in equities.
Bijan Moazami - Friedman, Billings, Ramsey & Co.
Barry, couple items, could you give us an update about the Unitrin acquisition in terms of what you’ve done so far to integrate the two companies and do you still expect to close this transaction by the end of the first quarter? Secondly, the credit spread are widening. At what point we should be expecting AmTrust to get interested in maybe a little bit of investment risk in the portfolio?
Barry D. Zyskind
The first question of Unitrin, as I think I mentioned previously, we started our integration as soon as we felt comfortable that we were going to proceed with the transaction. RIT and our operations people have been consistently going back and forth to Dallas working very closely with the Unitrin people. We already recognized and decided which employees will be joining AmTrust and we’ve done a lot of work on the systems and we fully expect, pending regulatory approval, which we are confident we will get hopefully by the end of the first quarter, that we’ll be able to close and everything will be on our system. In addition our senior management have been on a road show with the Unitrin senior management meeting with a lot of the Unitrin agents telling them about AmTrust to make sure that the transition goes very smoothly. In terms of the investment portfolio, Bijan, as we mentioned in the last previous call no question about, spreads are widening, we still want to be on the safe side of investments and as I mentioned last time we’re positioning the portfolio more towards higher quality because we don’t know how long this will last and if the economy goes into a recession and what happens with the credit market. So we’d rather be safe, maybe give up some possible returns by not getting in as early as some other people but we’ll make it up at later dates. But right now we continue to push the portfolio to a higher quality portfolio.
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