It’s very much a profit focus. And so the attractiveness of what we see in this environment for underwriting expansion is driving everything. Capital management, I think that’s a secondary tool. There’s nothing that would restrict it. It’s simply not as privileged given these opportunities that we have now. And the main point here is that with all this ample capital and capital generation ability. If we’re not able to remunerate that satisfactorily to our TSR objectives. Yes, then I think you’ll see more to management levers being pulled, but there’s nothing stopping that conceptually. It’s simply the opportunity set that we have in front of us that we want to pursue and capture.
Operator: And our next question comes from Jing Li with KBW.
Jing Li : The first question on that you mentioned in the block on the return on the casualty book. Just wondering like how big was and what’s left on these books? Are they in majority GL book?
Juan Andrade: Yes. So on the two items that we mentioned for general liability and frankly, what’s creating some of the issue that we’re proactively addressing right now. I would say one of those programs has been completely shut off at this point in time. And then second book has been remediated, re-underwritten very little new business coming into that at this point in time. But I don’t know Mike Karmilowicz, if you want to add a little bit of color to that.
Mike Karmilowicz: Yes. It’s basically a couple of $100 million. And these were actually dealt with over the last 18 to 24 months. So we proactively got in front of it. And again, I think that gets back to the point you made around active and portfolio management.
Jing Li : Just one more follow-up on the market. How attractive do you guys think is for the market looking post reform?
Jim Williamson: Yes. This is Jim Williamson. Thanks for the question. Our stance has been pretty consistent in that. We thought the government of Florida, the legislator did a very good job in the structuring of those reforms. Early indications in terms of communication with our clients in Florida and other stakeholders in the state would suggest that the reforms are doing what they were intended to do. But we also said that we would be waiting for the results of those reforms to show up in our data before determining what that means for our underwriting position. So our approach to Florida has been quite consistent over the last couple of years. We are a meaningful provider capacity to the state — and as long as our expectation for risk-adjusted returns are met, which would mean at least as good or improved from last year, meaning excellent, we’ll continue to provide that capacity.
Obviously, if that isn’t the case, we would do less. And if conditions get even better, we might do a little bit more. But I don’t expect a major change at the upcoming June 1 renewal.
Operator: And ladies and gentlemen, this concludes today’s question-and-answer session. I’d like to turn the conference back over to the management team for any closing remarks.
Juan Andrade: So thank you for the great dialogue and all the questions on the actions that we took in the quarter. I do think it’s important to zoom out and keep things in context, right? If you look at the 2023 results for the company, they were simply outstanding. 23% operating ROE, total shareholder return over 26%. And if you exclude the Bermuda DTA action, you’re still generating an operating ROE of 19% and a TSR of 21%. So simply world-class results. You also heard a commentary on the 1/1 renewals, which were excellent. That gives us pretty significant tailwind going into 2024. Not a great discussion on the reserves. And I think hopefully, the takeaway that you have here is we have a strong reserve position. We feel confident about where we are.
And then lastly, as Mark and I both said, we are confident in achieving our Investor Day targets. We have lots of levers to achieve our objectives. So with that, I look forward talking to you after our Q1 results. Thank you.
Operator: Thank you. This concludes today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines. Have a wonderful day.
