Operator: Your next question comes from the line of Casey Alexander from Compass Point. Your line is open.
Casey Alexander: Yes, thank you. Good morning.
Michael Kehoe: Good morning.
Casey Alexander: First — my first question is in relation to the ceding commissions and the impact on the expense ratio. Is there any persistency to that, or is that really just a one-time impact on the quarter?
Bryan Petrucelli: Well, I think it’s going to depend on the mix of business, right? So, if you have continued growth in the lines of business for which we buy reinsurance that have related ceding commissions, then I think theoretically, you could have a little bit — you’d have a lot of movement there. But I think in general — I think if you look at our expense ratio over the 12-month period and focusing less on sort of the volatility quarter-to-quarter is probably a good way for you to look at it.
Casey Alexander: Okay. Thank you. Secondly, while you have been earning more yield from your investment portfolio, over the last couple of quarters, the duration has been gone down pretty rapidly, which tells me that you’re really just still rolling short-term securities on that. Is there a strategy to eventually expand that duration and capture some of that yield for the longer term?
Michael Kehoe: Yes, Casey, this is Mike. The yield curves are inverted. So, we’re getting paid a lot more on the two-year duration, if you will than you are on the four, the five. And so, we’re capturing that. And we will probably shift at some point, but we’re willing to accept, if you will, the rollover risk of a shorter portfolio for the higher yield. And I think Brian had indicated in his remarks, that we’re getting around 5% on new money. So, that’s — I think that’s probably double where we were a little over a year ago.
Casey Alexander: Yes. Lastly, what is the — do you — what’s the age of the buildings that you bought?
Michael Kehoe: I think one may have been built in the ’60s and one may be in the ’80s, around 1980. I kind of forget, exactly, but they’re very well-maintained, and I don’t think there’s any real issue with the one that’s subject to the long-term lease. The older of the two does need to be renovated, and our basis in that purchase is pretty modest. So, we feel pretty positive about the return prospects on that deal.
Casey Alexander: All right. Thank you for taking my questions.
Operator: Your next question comes from the line of Andrew Anderson from Jefferies. Your line is open.
Andrew Anderson: Hey, good morning. It’s really strong growth this quarter, so it doesn’t appear to be coming in results, but I’ll ask anyways. I think last quarter, you had mentioned some slowdown in construction-related business. Has the degree of that changed or expanded to any other lines? Maybe just more broadly just economic thoughts here?
Brian Haney: Yes. We still see a little bit of relative slowdown from previous years. I would like to point out that we — our construction unit covers residential and commercial, and both new construction and renovations, and all across the spectrum. If you look at total construction spending in the U.S., it’s not actually down, it’s just not growing at the rate it has been growing the previous year. So, what we’re saying is consistent with what you’d see in the Federal Reserve data on total construction spending. It’s growing probably around 6% or 7% nominally.
Andrew Anderson: Got it. Thanks. And then, submission growth is still very strong here, ticked down just a bit. But perhaps with casualty becoming less of a difficult marketplace for brokers to place business, could that create some pressure on commission rates that you’re paying to brokers, since I think it’s a bit below average right now?
