What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-11-08 compared with 2023-08-08 · 365 added, 341 removed, 945 unchanged (43% of the section changed)

27 unchanged sentences

Short-term income protection business is written on a primary basis by our wholly owned subsidiaries Maiden Life Försäkrings AB ("Maiden LF") and Maiden General Försäkrings AB ("Maiden GF") in the Scandinavian and Northern European markets.

Insurance support services are provided to Maiden LF and Maiden GF through our wholly owned subsidiary, Maiden Global Holdings, Ltd.

("Maiden Global") which is also a licensed intermediary in the United Kingdom.

Our wholly owned subsidiary, Maiden Global Holdings, Ltd.

("Maiden Global") is a licensed intermediary in the United Kingdom.

Maiden Global had previously operated internationally by providing branded auto and credit life insurance products through insurer partners, particularly those in Europe and other global markets.

These products also produced reinsurance programs which were underwritten by our wholly owned subsidiary Maiden Reinsurance.

During 2023, we are evaluating the strategic value of Maiden LF and Maiden GF in relation to their ongoing growth and profitability prospects, regulatory capital requirements and ability to create shareholder value in excess of our target return on capital levels.

We expect to continue this evaluation during the second half of 2023.

In 2023, we are evaluating the strategic value of Maiden LF and Maiden GF in relation to their ongoing growth and profitability prospects, regulatory capital requirements and ability to create shareholder value in excess of our target return on capital levels.

We expect to continue this evaluation during the remainder of 2023.

Our business currently consists of two reportable segments:

15 unchanged sentences

For example, we have not engaged or pursued active reinsurance underwriting of new prospective risks as our assessment of the reinsurance marketplace along with our current operating profile has been that the risk-adjusted returns that may be produced via such underwriting are likely to be lower over the long-term than our cost of capital.

However, as interest rates have increased and moved towards historically observed levels, risk-adjusted returns for active reinsurance underwriting of new

prospective risks may become more attractive and while we have no immediate plans to resume such underwriting, we continue to evaluate if such a strategy would produce suitable value for shareholders.

However, as interest rates have increased and moved towards historically observed levels, risk-adjusted returns for active reinsurance underwriting of new prospective risks may become more attractive and while we have no immediate plans to resume such underwriting, we continue to evaluate if such a strategy would produce suitable value for shareholders.

Further, we continue to also evaluate our ongoing activities in insurance distribution.

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In addition to producing long-term returns that may exceed the target cost of capital, we expect the business produced through GLS should further enhance our ability to pursue the asset and capital management pillars of our business strategy.

The nature of GLS business plan is that it may take a sustained period of growth in insurance liabilities to produce the targeted returns.

The nature of GLS business plan is that it may take a sustained period of growth in insurance liabilities to produce the targeted returns, which has not occurred to date.

In addition, early stage initiatives such as GLS may take a period of time to reach profitability.

Finally, the nature of legacy transactions which GLS seeks to execute may be inconsistent as to their timing and not predictable as regards how many transactions may be completed in any fiscal period.

As of June 30, 2023, GLS and its subsidiaries hold insurance related liabilities of $27.8 million including total reserves of $21.5 million, an underwriting-related derivative liability of $4.0 million, and net deferred gains on retroactive reinsurance of $2.3 million.

As of September 30, 2023, GLS and its subsidiaries hold insurance related liabilities of $26.2 million including mainly total reserves of $19.9 million, an underwriting-related derivative liability of $4.0 million, and net deferred gains on retroactive reinsurance of $2.3 million.

Capital Management

8 unchanged sentences

Long-Term Debt " included under Item 1.

"Financial Statements" of this Quarterly Report on Form 10-Q for further information on the recent repurchases made by Maiden Reinsurance during the second quarter of 2023.

"Financial Statements" of this Quarterly Report on Form 10-Q for further information on the recent repurchases made by Maiden Reinsurance during the third quarter of 2023.

However, there can be no assurance that we will continue to pursue such capital management initiatives, or that they will provide appropriate risk-adjusted returns.

Maiden Holdings North America ("Maiden NA")

We believe Maiden NA’s investments, including its ownership of Maiden Reinsurance and its active asset management strategy, will create opportunities to utilize NOL carryforwards of $295.9 million at June 30, 2023.

The NOL carryforwards combined with additional net deferred tax assets ("DTA") primarily related to our insurance liabilities result in net U.S.

DTA (before valuation allowance) of $119.3 million or $1.17 per common share at June 30, 2023.

DTA (before valuation allowance) of $121.0 million or $1.20 per common share at September 30, 2023.

DTA of $121.0 million is not presently recognized on the Company's condensed consolidated balance sheets as a full valuation allowance is carried against it.

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Taken together, we believe these measures should generate additional income for Maiden NA in a tax-efficient manner, while sharing in the improvement in profitability anticipated in Maiden Reinsurance as a result of the measures enacted as described above.

Three and Six Months Ended June 30, 2023 and 2022 Financial Highlights

For the Three Months Ended June 30, 2023 2022 Change

Three and Nine Months Ended September 30, 2023 and 2022 Financial Highlights

For the Three Months Ended September 30, 2023 2022 Change

Summary Consolidated Statement of Income Data (unaudited):

($ in thousands except per share data)

Net (loss) income $ (2,933) $ 1,062 $ (3,995)

Gain from repurchase of preference shares — 24,690 (24,690)

Net (loss) income attributable to Maiden common shareholders (2,933) 25,752 (28,685)

Basic and diluted (loss) earnings per common share:

Net (loss) income attributable to common shareholders (2)

Net loss attributable to Maiden common shareholders $ (3,527) $ (8,160) $ 4,633

Basic and diluted loss per common share:

Net loss attributable to common shareholders (2)

(0.03) (0.09) 0.06

Gain from repurchase of preference securities per common share — 0.28 (0.28)

Gross premiums written 8,660 5,380 3,280

5 unchanged sentences

Non-GAAP measures:

Non-GAAP operating earnings (1)

Non-GAAP operating loss (1)

(11,747) (21,060) 9,313

Non-GAAP basic and diluted operating earnings per common share (1)

Non-GAAP basic and diluted operating loss per common share (1)

(0.12) (0.24) 0.12

Annualized non-GAAP operating return on average common shareholders' equity (1)

Annualized non-GAAP operating return on average adjusted shareholders' equity (1)

(14.4) % (32.6) % 18.2

For the Six Months Ended June 30, 2023 2022 Change

For the Nine Months Ended September 30, 2023 2022 Change

Summary Consolidated Statement of Income Data (unaudited):

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Non-GAAP measures:

Non-GAAP operating (loss) earnings (1)

Non-GAAP operating loss (1)

(15,173) (11,362) (3,811)

Non-GAAP basic and diluted (loss) operating earnings per common share (1)

Non-GAAP basic and diluted operating loss per common share (1)

(0.15) (0.13) (0.02)

Annualized non-GAAP operating return on average common shareholders' equity (1)

Annualized non-GAAP operating return on average adjusted shareholders' equity (1)

(6.2) % (5.9) % (0.3)

June 30, 2023 December 31, 2022 Change

September 30, 2023 December 31, 2022 Change

Consolidated Financial Condition ($ in thousands except per share data)

26 unchanged sentences

45.1 % 44.3 % 0.8

(1) Non-GAAP operating earnings (loss), non-GAAP operating earnings (loss) per common share, and annualized non-GAAP operating return on average common shareholders' equity are non-GAAP financial measures.

(1) Non-GAAP operating loss, non-GAAP operating loss per common share, and annualized non-GAAP operating return on average common shareholders' equity are non-GAAP financial measures.

See " Key Financial Measures " for additional information.

45 unchanged sentences

"Financial Statements" of this Quarterly Report on Form 10-Q.

The Company no longer presents certain non-GAAP measures such as combined ratio and its related components in this Quarterly Report on Form 10-Q for the three and six months ended June 30, 2023, as it believes that as the run-off of our reinsurance portfolios progresses, such ratios are increasingly not meaningful and of less value to readers as they evaluate the financial results of the Company, particularly compared to historical data.

The Company no longer presents certain non-GAAP measures such as combined ratio and its related components in this Quarterly Report on Form 10-Q for the three and nine months ended September 30, 2023, as it believes that as the run-off of our reinsurance portfolios progresses, such ratios are increasingly not meaningful and of less value to readers as they evaluate the financial results of the Company, particularly compared to historical data.

While an important metric of success, underwriting income (loss) does not reflect all components of profitability, as it does not recognize the impact of investment income earned on premiums between the time premiums are received and the time loss payments are ultimately paid to clients.

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Results of Operations

The following table sets forth our selected unaudited Condensed Consolidated Statement of Income data for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The following table sets forth our selected unaudited Condensed Consolidated Statement of Income data for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

5 unchanged sentences

$ 12,479 $ 12,251 $ 32,520 $ 23,816

Other insurance revenue, net 78 469 19 520

Other insurance (expense) revenue, net (16) 368 3 888

Net loss and LAE

10 unchanged sentences

9,048 6,637 29,111 20,871

Net realized and unrealized investment gains 1,145 2,111 2,150 4,420

Foreign exchange and other (losses) gains (2,621) 6,586 (5,437) 10,535

Net realized and unrealized investment gains (losses) 244 (1,572) 2,394 2,848

Foreign exchange and other gains (losses) 4,594 8,586 (843) 19,121

Interest and amortization expenses (4,814) (4,833) (13,411) (14,498)

1 unchanged sentence

Interest in income (loss) of equity method investments 2,190 (373) 6,942 (2,143)

Net (loss) income (2,933) 1,062 (14,261) (887)

Net loss (3,527) (8,160) (17,788) (9,047)

Gain from repurchase of preference shares — — — 28,233

4 unchanged sentences

(3) The Company no longer presents certain non-GAAP measures such as combined ratio and its related components in its results of operation, as it believes that as the run-off of its reinsurance portfolios progresses, such ratios are increasingly not meaningful and of less value to readers as they evaluate our financial results.

Net (Loss) Income

Net loss attributable to Maiden common shareholders for the three months ended June 30, 2023 was $2.9 million compared to net income available to Maiden common shareholders of $25.8 million for the same respective period in 2022.

Net income available to Maiden common shareholders for the three months ended June 30, 2022 included $24.7 million of gains from the repurchase of our preference shares.

Excluding the gain on the repurchase of our preference shares in 2022, there was a net loss of $2.9 million for the second quarter of 2023 compared to net income of $1.1 million for the second quarter of 2022, primarily due to the following:

• a higher underwriting loss of $9.3 million for the three months ended June 30, 2023 compared to underwriting loss of $5.1 million in the same period in 2022 largely due to:

◦ adverse prior year loss development of $4.5 million in the second quarter of 2023 compared to adverse prior year loss development of $1.0 million during the same period in 2022;

◦ on a current accident year basis, underwriting loss of $4.8 million for the three months ended June 30, 2023 compared to an underwriting loss of $4.2 million for the same period in 2022.

• foreign exchange and other losses were $2.6 million for the three months ended June 30, 2023, compared to foreign exchange and other gains of $6.6 million for the same period in 2022.

The decrease in our quarterly results were partly offset by the following favorable factors:

• increased total income from investment activities to $16.5 million for the three months ended June 30, 2023 compared to $6.7 million for the same period in 2022 which was comprised of:

◦ net investment income increased to $10.5 million for the three months ended June 30, 2023 compared to $7.7 million for the same period in 2022;

◦ realized and unrealized investment gains were $1.1 million for the three months ended June 30, 2023 compared to gains of $2.1 million for the same period in 2022;

◦ interest in income of equity method investments was $4.8 million for the three months ended June 30, 2023 compared to a loss of $3.0 million for the same period in 2022.

• corporate general and administrative expenses decreased to $2.9 million for the three months ended June 30, 2023 compared to $3.0 million for the same period in 2022.

Net loss attributable to Maiden common shareholders for the six months ended June 30, 2023 was $14.3 million compared to net income available to Maiden common shareholders of $27.3 million for the same period in 2022.

The net income for the six months ended June 30, 2022 included $28.2 million of gains from the repurchase of our preference shares.

Excluding the gain on the repurchase of our preference shares in 2022, our net loss for the six months ended June 30, 2023 was $14.3 million compared to a net loss of $0.9 million for the same period in 2022.

The net decrease in results for the six months ended June 30, 2023 compared to 2022 was primarily due to:

• a higher underwriting loss of $17.5 million for the six months ended June 30, 2023 compared to an underwriting loss of $6.8 million for the same period in 2022 largely due to:

• adverse prior year loss development of $8.2 million for the six months ended June 30, 2023 compared to favorable prior year development of $6.3 million for the same period in 2022 primarily related to the quota share reinsurance agreements in the AmTrust Reinsurance segment;

• on a current accident year basis, an underwriting loss of $9.4 million for the six months ended June 30, 2023 compared to an underwriting loss of $13.1 million for the same period in 2022 primarily due to results within the AmTrust Reinsurance segment as discussed below:

• significantly higher than expected negative premium adjustments in the AmTrust Reinsurance segment related to adjustments for estimated surcharges on Workers' Compensation policies and inuring AmTrust reinsurance for certain programs in Specialty Risk and Extended Warranty cessions (collectively the "AmTrust Cession Adjustments" which are discussed in greater detail in the AmTrust Reinsurance segment), net of commission and loss adjustments, contributed an underwriting loss of $5.1 million to our reported results for the six months ended June 30, 2022.

• foreign exchange and other losses of $5.4 million for the six months ended June 30, 2023 compared to foreign exchange and other gains of $10.5 million for the same period in 2022.

Net (loss) income (attributable) available to Maiden common shareholders

Net loss attributable to Maiden common shareholders for the three months ended September 30, 2023 was $3.5 million compared to net loss available to Maiden common shareholders of $8.2 million for the same respective period in 2022.

The increase in our financial results for the third quarter of 2023 compared to the third quarter of 2022 was primarily due to:

• lower underwriting loss which was $10.9 million for the three months ended September 30, 2023 compared to an underwriting loss of $12.6 million in the same period in 2022 largely due to:

◦ adverse prior year loss development of $7.8 million in the third quarter of 2023 compared to adverse prior year loss development of $0.8 million during the same period in 2022;

◦ on a current accident year basis, underwriting loss was $3.1 million for the three months ended September 30, 2023 compared to an underwriting loss of $11.8 million for the same period in 2022.

• higher total income from investment activities to $11.5 million for the three months ended September 30, 2023 compared to $4.7 million for the same period in 2022 which was comprised of:

◦ net investment income increased to $9.0 million for the three months ended September 30, 2023 compared to $6.6 million for the same period in 2022;

◦ realized and unrealized investment gains were $0.2 million for the three months ended September 30, 2023 compared to losses of $1.6 million for the same period in 2022;

◦ interest in income of equity method investments of $2.2 million for the three months ended September 30, 2023 compared to an interest in loss of $0.4 million for the same period in 2022.

• corporate general and administrative expenses decreased to $3.9 million for the three months ended September 30, 2023 compared to $4.1 million for the same period in 2022.

• The increase in our quarterly financial results were partly offset by lower foreign exchange and other gains which decreased to $4.6 million for the three months ended September 30, 2023, compared to foreign exchange and other gains of $8.6 million for the same period in 2022.

Net loss attributable to Maiden common shareholders for the nine months ended September 30, 2023 was $17.8 million compared to net income available to Maiden common shareholders of $19.2 million for the same period in 2022.

Net income for the nine months ended September 30, 2022 included $28.2 million of gains from the repurchase of our preference shares.

Excluding the gain on the repurchase of our preference shares in 2022, our net loss for the nine months ended September 30, 2023 was $17.8 million compared to a net loss of $9.0 million for the same period in 2022.

The net decrease in results for the nine months ended September 30, 2023 compared to the same period in 2022 was primarily due to:

• underwriting loss of $28.4 million for the nine months ended September 30, 2023 compared to an underwriting loss of $19.4 million for the same period in 2022 largely due to:

◦ adverse prior year loss development of $16.0 million for the nine months ended September 30, 2023 compared to favorable development of $5.5 million for the same period in 2022 primarily related to the quota share reinsurance agreements in the AmTrust Reinsurance segment;

◦ on a current accident year basis, an underwriting loss of $12.4 million for the nine months ended September 30, 2023 compared to an underwriting loss of $24.9 million for the same period in 2022 primarily due to results within the AmTrust Reinsurance segment as discussed below;

◦ significantly higher than expected negative premium adjustments in the AmTrust Reinsurance segment related to adjustments for estimated surcharges on Workers' Compensation policies and inuring AmTrust reinsurance for certain programs in Specialty Risk and Extended Warranty cessions (collectively the "AmTrust Cession Adjustments" which are discussed in greater detail in the AmTrust Reinsurance segment), net of commission and loss adjustments, contributed an underwriting loss of $5.1 million to our reported results for the nine months ended September 30, 2022.

• foreign exchange and other losses of $0.8 million for the nine months ended September 30, 2023 compared to foreign exchange and other gains of $19.1 million for the same period in 2022.

The decrease in our year-to-date results were partly offset by the following favorable factors:

• increased total income from investment activities of $27.0 million for the six months ended June 30, 2023 compared to $16.9 million for the same period in 2022 which was comprised of:

• net investment income increased to $20.1 million for the six months ended June 30, 2023 compared to $14.2 million for the same period in 2022;

• realized and unrealized investment gains were $2.2 million for the six months ended June 30, 2023 compared to realized and unrealized gains of $4.4 million for the same period in 2022;

• interest in income of equity method investments was $4.8 million for the six months ended June 30, 2023 compared to a loss of $1.8 million for the same period in 2022.

• corporate general and administrative expenses decreased to $9.9 million for the six months ended June 30, 2023 compared to $11.3 million for the same period in 2022.

• higher total income from investment activities of $38.4 million for the nine months ended September 30, 2023 compared to $21.6 million for the same period in 2022 which was comprised of:

◦ net investment income increased to $29.1 million for the nine months ended September 30, 2023 compared to $20.9 million for the same period in 2022;

◦ realized and unrealized investment gains were $2.4 million for the nine months ended September 30, 2023 compared to realized and unrealized gains of $2.8 million for the same period in 2022;

◦ interest in income of equity method investments was $6.9 million for the nine months ended September 30, 2023 compared to interest in loss of equity method investments of $2.1 million for the same period in 2022.

• corporate general and administrative expenses decreased to $13.8 million for the nine months ended September 30, 2023 compared to $15.4 million for the same period in 2022.

Net Premiums Written

The tables below compare net premiums written by our reportable segments, reconciled to the total consolidated net premiums written for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, 2023 2022 Change in

The tables below compare net premiums written by our reportable segments, reconciled to the total consolidated net premiums written for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

3 unchanged sentences

Total $ 8,625 $ 5,222 $ 3,403

For the Six Months Ended June 30, 2023 2022 Change in

For the Nine Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

3 unchanged sentences

Total $ 16,260 $ (1,915) $ 18,175

Net premiums written for the three and six months ended June 30, 2023 increased to $6.9 million and $7.6 million, respectively, compared to net premiums written of $3.2 million and $(7.1) million for the same respective periods in 2022:

• Premiums written in the Diversified Reinsurance segment increased by $0.7 million and $2.8 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 due to growth in direct premiums for Credit Life programs written by Maiden LF and Maiden GF.

• Premiums written in the AmTrust Reinsurance segment increased by $3.0 million and $11.9 million for the three and six months ended June 30, 2023 compared to the same respective periods in 2022 largely due to significant negative written premiums for the AmTrust Cession Adjustments during the three and six months ended June 30, 2022.

Net premiums written for the three and nine months ended September 30, 2023 increased to $8.6 million and $16.3 million, respectively, compared to net premiums written of $5.2 million and $(1.9) million for the same respective periods in 2022:

• Premiums written in the Diversified Reinsurance segment increased by $0.7 million and $3.5 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022 due to growth in direct premiums for Credit Life programs written by Maiden LF and Maiden GF.

• Premiums written in the AmTrust Reinsurance segment increased by $2.7 million and $14.6 million for the three and nine months ended September 30, 2023 compared to the same respective periods in 2022.

The significant negative

written premiums in the prior year period are primarily related to $15.8 million of AmTrust Cession Adjustments for the nine months ended September 30, 2022.

Please refer to the analysis below of our Diversified Reinsurance and AmTrust Reinsurance segments for further details.

Net Premiums Earned

Net premiums earned increased by $0.6 million and $8.5 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

The tables below compares net premiums earned by our reportable segments, reconciled to the total consolidated net premiums earned, for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, 2023 2022 Change in

Net premiums earned increased by $0.2 million and $8.7 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

The tables below compares net premiums earned by our reportable segments, reconciled to the total consolidated net premiums earned, for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

4 unchanged sentences

$ 12,479 $ 12,251 $ 228

For the Six Months Ended June 30, 2023 2022 Change in

For the Nine Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

4 unchanged sentences

$ 32,520 $ 23,816 $ 8,704

Net premiums earned in the Diversified Reinsurance segment for the three and six months ended June 30, 2023 increased by $0.1 million or 1.1% and $1.6 million or 12.2% compared to the same respective periods in 2022 mainly due to growth in Credit Life programs written by Maiden LF and Maiden GF.

Net premiums earned in the Diversified Reinsurance segment for the three and nine months ended September 30, 2023 increased by $0.3 million or 4.0% and $1.9 million or 9.3% compared to the same respective periods in 2022 mainly due to growth in Credit Life programs written by Maiden LF and Maiden GF.

Please refer to the analysis of our Diversified Reinsurance segment for further discussion.

Net premiums earned in the AmTrust Reinsurance segment for the three and six months ended June 30, 2023 increased by $0.5 million and $6.9 million compared to the same respective periods in 2022 primarily due to significant negative earned premium adjustments made in the first quarter of 2022.

Net premiums earned in the AmTrust Reinsurance segment for the three and nine months ended September 30, 2023 decreased by $47.0 thousand and increased by $6.8 million compared to the same respective periods in 2022.

The year-to-date movement is primarily due to significant negative earned premium adjustments made in the first quarter of 2022.

Please refer to the analysis of our AmTrust Reinsurance segment for further discussion.

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Net Investment Income

Net investment income increased by $2.9 million or 37.2% and $5.8 million or 41.0% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

Annualized average book yields increased to 4.2% and 4.0% for the three and six months ended June 30, 2023, respectively, compared to 2.0% and 1.9% for the same respective periods in 2022 due to the following factors:

• 33.9% of our fixed income investments as of June 30, 2023 are floating rate investments which enabled us to take advantage of a higher interest rate environment by reinvesting at higher yields more quickly;

• higher crediting interest rate on our funds withheld balance with AmTrust which increased to 3.5% in 2023 from 2.1% in 2022, on an average ending balances of $319.2 million and $351.8 million during the three and six months ended June 30, 2023, respectively;

• higher weighted average interest rate on our loan to related party of $168.0 million which increased to 7.0% and 6.7% during the three and six months ended June 30, 2023, respectively, compared to 2.8% and 2.4% for the same respective periods in 2022.

Average aggregate fixed income assets at June 30, 2023 decreased by 36.8% compared to June 30, 2022 due to the continued run-off of reinsurance liabilities previously written on prospective risks, resulting in negative operating cash flows as we run-off our existing reinsurance liabilities.

The following table details our average aggregate fixed income assets (at cost) and annualized investment book yield for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, For the Six Months Ended June 30,

Net investment income increased by $2.4 million or 36.3% and $8.2 million or 39.5% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

Annualized average book yields increased to 4.3% and 4.1% for the three and nine months ended September 30, 2023, respectively, compared to 2.2% and 2.0% for the same respective periods in 2022 due to the following factors:

• 37.8% of our fixed income investments as of September 30, 2023 are floating rate investments which enabled these investments to respond to the higher interest rate environment more quickly;

• higher crediting interest rate on our funds withheld balance with AmTrust which increased to 3.5% in 2023 from 2.1% in 2022, on an average ending balances of $250.0 million and $317.1 million during the three and nine months ended September 30, 2023, respectively;

• higher weighted average interest rate on our loan to related party of $168.0 million which increased to 7.3% and 6.9% for the three and nine months ended September 30, 2023, respectively, compared to 4.2% and 3.0% for the same respective periods in 2022.

Average aggregate fixed income assets at September 30, 2023 decreased by 40.6% compared to September 30, 2022 due to the continued run-off of reinsurance liabilities previously written on prospective risks, resulting in negative operating cash flows as we run-off our existing reinsurance liabilities primarily through the funds withheld receivable.

The following table details our average aggregate fixed income assets (at cost) and annualized investment book yield for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

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GAAP consolidated financial statements.

Net Realized and Unrealized Investment Gains

Net realized and unrealized investment gains of $1.1 million and $2.2 million were recognized for the three and six months ended June 30, 2023, respectively, compared to net realized and unrealized investment gains of $2.1 million and $4.4 million for the same respective periods in 2022.

Total net realized and unrealized investment gains for the three and six months ended June 30, 2023 and 2022 are summarized in the table below by investment category:

For the Three Months Ended June 30, For the Six Months Ended June 30,

2023 2022 2023 2022

Net realized gains (losses):

Net Realized and Unrealized Investment Gains (Losses)

Net realized and unrealized investment gains of $0.2 million and $2.4 million were recognized for the three and nine months ended September 30, 2023, respectively, compared to net realized and unrealized investment losses of $1.6 million and gains of $2.8 million for the same respective periods in 2022.

Total net realized and unrealized investment gains (losses) for the three and nine months ended September 30, 2023 and 2022 are summarized in the table below by investment category:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

Net realized gains (losses):

Fixed income assets (1)

4 unchanged sentences

Other investments, including equity securities 545 (1,779) 3,295 1,466

Total net unrealized gains 1,921 2,158 2,750 3,245

Total net realized and unrealized investment gains $ 1,145 $ 2,111 $ 2,150 $ 4,420

Total net unrealized gains (losses) 545 (1,779) 3,295 1,466

Total net realized and unrealized investment gains (losses) $ 244 $ (1,572) $ 2,394 $ 2,848

(1) Fixed income assets includes AFS securities as well as cash, restricted cash, funds withheld receivable, and loan to related party.

Interest in Income (Loss) of Equity Method Investments

The Company recognized interest in income of equity method investments of $4.8 million and $4.8 million for the three and six months ended June 30, 2023, respectively, compared to an interest in the loss of equity method investments of $3.0 million and $1.8 million for the same respective periods in 2022.

Equity method investments consist of real estate investments of $42.6 million and other investments of $30.6 million as of June 30, 2023.

Interest in income (loss) of equity method investments for the three and six months ended June 30, 2023 and 2022 is detailed by investment category in the following table:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The Company recognized interest in income of equity method investments of $2.2 million and $6.9 million for the three and nine months ended September 30, 2023, respectively, compared to an interest in the loss of equity method investments of $0.4 million and $2.1 million for the same respective periods in 2022.

Equity method investments consist of real estate investments of $48.5 million and other investments of $30.9 million as of September 30, 2023.

Interest in income (loss) of equity method investments for the three and nine months ended September 30, 2023 and 2022 is detailed by investment category in the following table:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

4 unchanged sentences

Net Loss and LAE

Net loss and LAE increased by $4.7 million for the second quarter of 2023 compared to the same period in 2022 largely due to adverse prior year loss development in both reporting segments.

Net losses were impacted by net adverse prior year loss development of $4.5 million for the second quarter of 2023 compared to net adverse prior year loss development of $1.0 million for the same period in 2022.

Net loss and LAE increased by $16.8 million for the six months ended June 30, 2023 compared to the same period in 2022 largely due to adverse prior year loss development in both reporting segments.

Net losses were impacted by net adverse prior year loss development of $8.2 million for the six months ended June 30, 2023 compared to favorable prior year reserve development of $6.3 million for the same period in 2022.

Net loss and LAE decreased by $2.3 million for the third quarter of 2023 compared to the same period in 2022 driven by a decline in current year losses.

Net losses were impacted by net adverse prior year loss development of $7.8 million for the third quarter of 2023 compared to net adverse prior year loss development of $0.8 million for the same period in 2022.

Excluding adverse development, the current year losses were $7.3 million for the third quarter of 2023 compared to $16.6 million for the third quarter of 2022.

Net loss and LAE increased by $14.5 million for the nine months ended September 30, 2023 compared to the same period in 2022 largely due to adverse prior year loss development in both reporting segments.

Net losses were impacted by net adverse prior year loss development of $16.0 million for the nine months ended September 30, 2023 compared to favorable prior year reserve development of $5.5 million for the same period in 2022.

The cessation of active reinsurance underwriting on prospective risks included the termination of the AmTrust Quota Share and European Hospital Liability Quota Share effective January 1, 2019.

1 unchanged sentence

Commission and Other Acquisition Expenses

Commission and other acquisition expenses increased by $0.1 million or 1.2% and increased by $1.8 million or 23.8% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 driven by lower earned premium adjustments in the AmTrust Reinsurance segment in 2023 compared to 2022.

This resulted in a corresponding increase in commission costs and brokerage fees.

Commission and other acquisition expenses decreased by $0.1 million or 1.1% and increased by $1.7 million or 13.3% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

The year-to-date movement was driven by lower earned premium adjustments in the AmTrust Reinsurance segment in 2023 compared to 2022 which resulted in a corresponding increase in commission costs and brokerage fees.

Please see further discussion in the individual segment analysis below.

1 unchanged sentence

General and administrative expenses include both segment and corporate expenses segregated for analytical purposes as a component of underwriting income.

Total general and administrative expenses decreased by $0.5 million, or 6.2% and decreased by $1.2 million or 6.8% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 primarily due to lower stock-based incentive compensation costs and corporate insurance expenses incurred.

General and administrative expenses for the three and six months ended June 30, 2023 and 2022 were comprised of:

For the Three Months Ended June 30, For the Six Months Ended June 30,

Total general and administrative expenses increased by $0.3 million, or 4.6% and decreased by $0.9 million or 3.8% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

Corporate expenses decreased for the nine months ended September 30, 2023 largely due to lower stock-based incentive compensation costs which were $1.4 million compared to $2.5 million for the same period in 2022.

General and administrative expenses for the three and nine months ended September 30, 2023 and 2022 were comprised of:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

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Interest and Amortization Expenses

Total interest and amortization expenses related to outstanding senior notes issued by Maiden Holdings in 2016 and Maiden NA in 2013 ("Senior Notes") were $4.8 million and $8.6 million for the three and six months ended June 30, 2023, respectively, compared to $4.8 million and $9.7 million for the same respective periods in 2022.

This included interest expense incurred on the Senior Notes for the three and six months ended June 30, 2023 and 2022 of $4.8 million and $9.6 million, respectively.

Total interest and amortization expenses related to outstanding senior notes issued by Maiden Holdings in 2016 and Maiden NA in 2013 ("Senior Notes") were $4.8 million and $13.5 million for the three and nine months ended September 30, 2023, respectively, compared to $4.8 million and $14.5 million for the same respective periods in 2022.

This included interest expense incurred on the Senior Notes for the three and nine months ended September 30, 2023 and 2022 of $4.8 million and $14.3 million, respectively.

The issuance costs related to the Senior Notes were capitalized and are amortized over their effective life using the effective interest method of amortization.

Due to a change in the amortization method for the 2013 Senior Notes at June 30, 2023, amortization expenses were $0.0 million and $(0.9) million for the three and six months ended June 30, 2023, respectively, compared to amortization expenses of $0.1 million and $0.1 million for the same respective periods in 2022.

During the three and six months ended June 30, 2023, the Company realized a gain of $39.9 thousand due to the partial repurchase of the 2013 Senior Notes which was offset against total interest and amortization expenses discussed above.

Due to a change in the amortization method for the 2013 Senior Notes in 2023, total amortization expenses were $37.0 thousand and $(0.9) million for the three and nine months ended September 30, 2023, respectively, compared to amortization expenses of $0.1 million and $0.2 million for the same respective periods in 2022.

During the nine months ended September 30, 2023, the Company realized a gain of $39.9 thousand due to the partial repurchase of the 2013 Senior Notes which was offset against total interest and amortization expenses as reported above.

Please refer to " Notes to Condensed Consolidated Financial Statements (unaudited) Note 7.

Long Term Debt " for further details on the Senior Notes.

The weighted average effective interest rate for the Senior Notes was 7.6% for the three and six months ended June 30, 2023 and 2022, respectively.

Foreign Exchange and Other (Losses) Gains

Net foreign exchange and other losses of $2.6 million and losses of $5.4 million were realized during the three and six months ended June 30, 2023, respectively, compared to net foreign exchange and other gains of $6.6 million and gains of $10.5 million for the same respective periods in 2022.

At June 30, 2023, net foreign exchange losses were primarily driven by exposures to euro, British pound and other non-USD denominated net loss reserves and insurance related liabilities in excess of foreign currency assets.

Our non-USD denominated liabilities at June 30, 2023 included net loss reserves of $313.5 million.

Our foreign currency asset exposures at June 30, 2023 included $172.1 million of fixed maturity securities managed by our investment managers who have the discretion to hold foreign currency exposures as part of their total return strategy as well as $22.6 million of equity method real estate investments denominated in Canadian dollars.

Net foreign exchange losses of $2.6 million and $4.7 million for the three and six months ended June 30, 2023, respectively, were attributable to the weakening of the U.S.

dollar on the re-measurement of net loss reserves and insurance related liabilities denominated in British pound and euro.

Net foreign exchange gains of $7.9 million and $11.9 million during the three and six months ended June 30, 2022, respectively, were attributable to the strengthening of the U.S.

The weighted average effective interest rate for the Senior Notes was 7.6% for the three and nine months ended September 30, 2023 and 2022, respectively.

Foreign Exchange and Other Gains (Losses)

Net foreign exchange and other gains of $4.6 million and losses of $0.8 million were realized during the three and nine months ended September 30, 2023, respectively, compared to net foreign exchange and other gains of $8.6 million and gains of $19.1 million for the same respective periods in 2022.

At September 30, 2023, net foreign exchange losses on a year-to-date basis were primarily driven by exposures to euro, British pound and other non-USD denominated net loss reserves and insurance related liabilities in excess of foreign currency assets.

Our non-USD denominated liabilities at September 30, 2023 included net loss reserves of $276.3 million.

Our foreign currency asset exposures at September 30, 2023 included $167.2 million of fixed maturity securities managed by our investment managers who have the discretion to hold foreign currency exposures as part of their total return strategy as well as $26.0 million of equity method real estate investments denominated in Canadian dollars.

Net foreign exchange gains of $4.6 million in the third quarter of 2023 were driven by modest strengthening of the U.S.

dollar on the re-measurement of net loss reserves and insurance related liabilities denominated in British pound and euro during the period.

Net foreign exchange losses of $0.1 million for the nine months ended September 30, 2023 were attributable to the weakening of the U.S.

dollar on the re-measurement of net loss reserves and insurance related liabilities denominated in British pound and euro since the start of the year.

Net foreign exchange gains of $8.6 million and $20.5 million during the three and nine months ended September 30, 2022, respectively, were attributable to the strengthening of the U.S.

dollar on the re-measurement of net loss reserves and insurance related liabilities denominated in British pound and euro.

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Diversified Reinsurance Segment

The underwriting results for our Diversified Reinsurance segment for the three and six months ended June 30, 2023 and 2022 were as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The underwriting results for our Diversified Reinsurance segment for the three and nine months ended September 30, 2023 and 2022 were as follows:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

5 unchanged sentences

$ 7,207 $ 6,932 $ 21,882 $ 20,012

Other insurance revenue, net 78 469 19 520

Other insurance (expense) revenue, net (16) 368 3 888

Net loss and LAE

5 unchanged sentences

Underwriting (loss) income $ (2,541) $ 40 $ (7,648) $ 264

Underwriting results in the Diversified Reinsurance segment decreased for the three and six months ended June 30, 2023 compared to the same respective periods in 2022.

This was primarily due to an underwriting loss from International and GLS operations for the three and six months ended June 30, 2023 as detailed in the table below.

Underwriting (loss) income by business unit is detailed in the table below for the Diversified Reinsurance segment for the three and six months ended June 30, 2023 and 2022, respectively:

For the Three Months Ended June 30, For the Six Months Ended June 30,

Underwriting (loss) income by business unit is detailed in the table below for the Diversified Reinsurance segment for the three and nine months ended September 30, 2023 and 2022, respectively:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

3 unchanged sentences

Underwriting (loss) income $ (2,541) $ 40 $ (7,648) $ 264

Premiums — The growth in written and earned premium was the result of new Credit Life programs written by Maiden LF and Maiden GF in the three and six months ended June 30, 2023.

Gross premiums written increased by $0.5 million or 8.2% and increased by $2.6 million or 24.0% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

Net premiums written increased by $0.7 million or 11.0% and increased by $2.8 million or 26.9% during the three and six months ended June 30, 2023, compared to the same respective periods in 2022.

Net premiums earned increased by $0.1 million or 1.1% and increased by $1.6 million or 12.2% during the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

Other Insurance Revenue, Net — Other insurance revenue, net includes fee related income earned from our GLS business, fair value changes in underwriting-related derivatives related to certain coverages on retroactive reinsurance contracts written by GLS, and fee income derived from our IIS business not directly associated with premium revenue assumed by the Company as specified in the table below.

Total other insurance revenue, net decreased by $0.4 million and $0.5 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 primarily due to fair value changes in non-hedged underwriting-related derivatives on GLS contracts.

The table below shows other insurance revenue by source for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, 2023 2022 Change

Underwriting results in the Diversified Reinsurance segment decreased significantly for the three and nine months ended September 30, 2023 compared to the same respective periods in 2022 primarily due to underwriting losses in GLS and International driven by higher GLS operating costs during the three and nine months ended September 30, 2023 and adverse development on International business and other runoff lines as discussed further below under the net losses and LAE section.

Premiums — The growth in written and earned premium was the result of new Credit Life programs written by Maiden LF and Maiden GF in the three and nine months ended September 30, 2023.

Gross premiums written increased by $0.6 million or 9.3% and increased by $3.2 million or 18.7% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

Net premiums written increased by $0.7 million or 11.6% and increased by $3.5 million or 21.4% during the three and nine months ended September 30, 2023, compared to the same respective periods in 2022.

Net premiums earned increased by $0.3 million or 4.0% and increased by $1.9 million or 9.3% during the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

Other Insurance (Expense) Revenue, Net — Other insurance (expense) revenue, net includes fee related income generated from our GLS business, fair value changes in underwriting-related derivatives related to certain coverages on retroactive reinsurance contracts written by GLS, and fee income derived from our IIS business not directly associated with premium revenue assumed by the Company as specified in the table below.

Total other insurance (expense) revenue, net decreased by $0.4 million and $0.9 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022 primarily due to fair value changes in non-hedged underwriting-related derivatives on GLS contracts.

The tables below show other insurance revenue by source for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, 2023 2022 Change

($ in thousands)

2 unchanged sentences

Other service fee income (19) 38 (57)

Total other insurance revenue, net $ 78 $ 469 $ (391)

For the Six Months Ended June 30, 2023 2022 Change

Total other insurance (expense) revenue, net $ (16) $ 368 $ (384)

For the Nine Months Ended September 30, 2023 2022 Change

($ in thousands)

3 unchanged sentences

Total other insurance revenue, net $ 3 $ 888 $ (885)

Net Loss and LAE — Net loss and LAE increased by $1.5 million and increased by $6.0 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 primarily due to new premium growth in Credit Life programs written by Maiden LF and Maiden GF as well as adverse prior year development experienced in the current year periods .

The net loss and LAE was impacted by net adverse prior year loss development of $1.3 million and $2.1 million for the three and six months ended June 30, 2023 , respectively, compared to adverse prior year development of $0.8 million and favorable development of $1.4 million for the same respective periods in 2022.

The net adverse loss development for the three and six months ended June 30, 2023 was primarily from a German auto program in run-off from our International unit along with development from other runoff business lines and included the recognition of expected credit losses on reinsurance recoverable on unpaid losses.

The prior year loss development in 2022 was due to favorable reserve development in German Auto Programs and GLS partly offset by adverse development in European Capital Solutions that occurred in the second quarter of 2022.

Commission and Other Acquisition Expenses — Commission and other acquisition expenses remained flat and decreased by $0.1 million or 1.6% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

General and Administrative Expenses — General and administrative expenses increased by $0.1 million or 1.7% and increased by $0.5 million or 10.6% for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

Net Loss and LAE — Net loss and LAE increased by $2.2 million and $8.2 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022 primarily due to new premium growth in Credit Life programs written by Maiden LF and Maiden GF as well as adverse prior year loss development experienced in International and other run-off lines .

The net loss and LAE was impacted by net adverse prior year loss development of $1.9 million and $3.9 million for the three and nine months ended September 30, 2023 , respectively, compared to favorable prior year development of $0.6 million and $2.0 million for the same respective periods in 2022.

The net adverse loss development for the three and nine months ended September 30, 2023 was primarily from a German auto program in run-off, along with development in European Capital Solutions and other runoff business lines.

It also included the recognition of expected credit losses on reinsurance recoverable on unpaid losses for the nine months ended September 30, 2023.

The net favorable loss development for the three and nine months ended September 30, 2022 was driven by German Auto Programs and GLS partly offset by adverse development in European Capital Solutions.

Commission and Other Acquisition Expenses — Commission and other acquisition expenses decreased by 0.6% and 1.3% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

General and Administrative Expenses — General and administrative expenses increased by $0.3 million or 16.6% and increased by $0.9 million or 12.2% for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

AmTrust Reinsurance Segment

The AmTrust Reinsurance segment reported an underwriting loss of $6.1 million and $12.4 million during the three and six months ended June 30, 2023, respectively, compared to an underwriting loss of $3.9 million and $7.0 million for the same respective periods in 2022.

The decrease in underwriting results for the three and six months ended June 30, 2023 was primarily due to adverse prior year loss development of $3.2 million and $6.1 million during the three and six months ended June 30, 2023, respectively, compared to net prior year loss development of adverse $0.1 million and favorable $4.9 million for the same respective periods in 2022.

The underwriting results for the AmTrust Reinsurance segment for the three and six months ended June 30, 2023 and 2022 were as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The AmTrust Reinsurance segment reported an underwriting loss of $8.4 million and $20.8 million during the three and nine months ended September 30, 2023, respectively, compared to an underwriting loss of $12.7 million and $19.7 million for the same respective periods in 2022.

The underwriting results for the AmTrust Reinsurance segment for the three and nine months ended September 30, 2023 and 2022 were as follows:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

12 unchanged sentences

Underwriting loss $ (8,369) $ (12,667) $ (20,777) $ (19,676)

Premiums — The tables below show net premiums written by category for the three and six months ended June 30, 2023 and 2022, respectively:

For the Three Months Ended June 30, 2023 2022 Change in

Premiums — The tables below show net premiums written by category for the three and nine months ended September 30, 2023 and 2022, respectively:

For the Three Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

4 unchanged sentences

Specialty Risk and Extended Warranty

2,058 (126) 2,184

Total AmTrust Reinsurance

$ 1,898 $ (805) $ 2,703

For the Six Months Ended June 30, 2023 2022 Change in

For the Nine Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

8 unchanged sentences

$ (3,892) $ (18,520) $ 14,628

Furthermore, the termination of the AmTrust Quota Share and the European Hospital Liability Quota Share as of January 1, 2019 resulted in no new business written under these contracts since 2018.

The negative gross and net premiums written for the six months ended June 30, 2023 reflect cession adjustments of $6.1 million due to the cancellation of cases in a certain program within Specialty Risk and Extended Warranty.

The negative gross and net premiums written for the six months ended June 30, 2022 reflect the AmTrust Cession Adjustments which consist of higher than expected adjustments related to the following items:

The negative premiums for the nine months ended September 30, 2023 and September 30, 2022 reflect the termination of the AmTrust Quota Share and the European Hospital Liability Quota Share as of January 1, 2019 which has resulted in no new business written under these contracts since 2018.

The negative gross and net premiums written for the nine months ended September 30, 2023 reflect cession adjustments of $6.1 million due to the cancellation of cases in a certain program within Specialty Risk and Extended Warranty.

The negative gross and net premiums written for the nine months ended September 30, 2022 reflect the AmTrust Cession Adjustments which consist of higher than expected adjustments related to the following items:

• $11.0 million of premium reductions on Workers Compensation policy surcharges in Small Commercial Business subsequent to the termination of the AmTrust Quota Share;

• $4.8 million of premium reductions to AmTrust's inuring reinsurance for certain programs in Specialty Risk and Extended Warranty which reduced the amount of premium ceded to Maiden.

Net premiums earned increased by $0.5 million and $6.9 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 primarily driven by lower negative premium adjustments during the first half of 2023 compared to significantly higher AmTrust Cession Adjustments made in the first half of 2022, largely due to negative premiums earned in Small Commercial Business policies.

The tables below provide detail on net premiums earned in the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, 2023 2022 Change in

Net premiums earned decreased by $47.0 thousand and increased by $6.8 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

The year-to-date movement was primarily driven by lower negative premium adjustments during 2023 compared to significantly higher AmTrust Cession Adjustments made in 2022, largely due to negative premiums earned in Small Commercial Business policies.

The tables below provide detail on net premiums earned in the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

7 unchanged sentences

$ 5,272 $ 5,319 $ (47)

For the Six Months Ended June 30, 2023 2022 Change in

For the Nine Months Ended September 30, 2023 2022 Change in

($ in thousands) Total Total $

8 unchanged sentences

$ 10,638 $ 3,804 $ 6,834

Net Loss and LAE — Net loss and LAE increased by $3.2 million and $10.8 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022 driven by higher adverse prior year loss development in the current year periods.

Net adverse prior year loss development was $3.2 million and $6.1 million during the three and six months ended June 30, 2023, respectively compared to net adverse development of $0.1 million and favorable development of $4.9 million for the same respective periods in 2022.

Net adverse prior year loss development for the three and six months ended June 30, 2023 was primarily due to General Liability and Commercial Auto Liability partly offset by continued favorable development in Workers Compensation.

Net adverse prior year loss development for the three months ended June 30, 2022 was driven by modest deterioration in General Liability and Commercial Auto partly offset by continued favorable development on Workers Compensation.

The net favorable prior year loss development for the six months ended June 30, 2022 was due to favorable runoff of Workers Compensation business and AmTrust Cession Adjustments for Specialty Risk and Extended Warranty.

Commission and Other Acquisition Expenses — Commission and other acquisition expenses increased by $0.1 million and $1.9 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

This was driven by lower negative earned premium adjustments in the first half of 2023 compared to significantly higher AmTrust Cession Adjustments made in the first half of 2022, largely due to negative premiums earned in Small Commercial Business policies which resulted in a corresponding decrease in commission costs and brokerage fees.

General and Administrative Expenses — General and administrative expenses decreased by $0.4 million for the three and six months ended June 30, 2023, respectively, compared to the same respective periods in 2022.

Net Loss and LAE — Net loss and LAE decreased by $4.4 million and increased by $6.3 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022 driven by a decline in current year losses offset by higher adverse prior year loss development under the AmTrust Quota Share for the nine months ended September 30, 2023.

The table below shows prior year loss development for the AmTrust Reinsurance segment for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

2023 2022 2023 2022

Prior Year Loss Development adverse (favorable) ($ in thousands)

AmTrust Quota Share $ (22) $ (4,572) $ 6,414 $ (9,514)

AmTrust other runoff (20) — (360) —

European Hospital Liability Quota Share 6,012 5,996 5,992 5,996

Total AmTrust Reinsurance Prior Year Development $ 5,970 $ 1,424 $ 12,046 $ (3,518)

Net adverse prior year loss development was $6.0 million and $12.0 million during the three and nine months ended September 30, 2023, respectively compared to net adverse development of $1.4 million and favorable development of $3.5 million for the same respective periods in 2022.

Net adverse prior year loss development for the three and nine months ended September 30, 2023 was primarily due to European Hospital Liability for the three months ended September 30, 2023, and European Hospital Liability and the AmTrust Quota Share (General Liability and Commercial Auto Liability partly offset by continued favorable development in Workers Compensation) for the nine months ended September 30, 2023.

Net adverse loss development on European Hospital Liability was primarily driven by emergence of loss data during 2023 on underwriting years 2011 to 2016.

Net adverse prior year loss development for the three months ended September 30, 2022 was driven by unfavorable movements in European Hospital Liability due to higher than expected loss emergence in Italian Hospital Liability policies as well as the agreed exit cost of $3.7 million (€3.4 million) for the commutation of French Hospital Liability policies as described in "Note 10.

Related Party Transactions" ;

partly offset by favorable runoff of Workers Compensation business in the AmTrust Quota Share.

The net favorable prior year loss development for the nine months ended September 30, 2022 included $5.3 million of favorable reserve adjustments for estimated surcharges on Workers' Compensation policies and inuring AmTrust reinsurance for programs in Specialty Risk and Extended Warranty cessions ("AmTrust Cession Adjustments").

Excluding AmTrust Cession Adjustments, there was adverse development of $1.8 million for the nine months ended September 30, 2022 driven by unfavorable movements in European Hospital Liability due to higher than expected loss emergence in Italian Hospital Liability policies as well as the agreed exit cost of $3.7 million (€3.4 million for commutation of French Hospital Liability policies as described in "Note 10.

Related Party Transactions" ;

partly offset by favorable runoff of Workers Compensation business.

Commission and Other Acquisition Expenses — Commission and other acquisition expenses decreased by $38.0 thousand and increased by $1.8 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

The year-to-date movement was driven by lower negative earned premium adjustments in 2023 compared to significant AmTrust Cession Adjustments made last year, which resulted in negative premiums earned in Small Commercial Business policies and a corresponding reduction in commission costs and brokerage fees in 2022 .

General and Administrative Expenses — General and administrative expenses increased by $0.1 million and decreased by $0.2 million for the three and nine months ended September 30, 2023, respectively, compared to the same respective periods in 2022.

Liquidity and Capital Resources

2 unchanged sentences

The jurisdictions in which our operating subsidiaries are licensed to write business impose regulations requiring companies to maintain or meet statutory solvency and liquidity requirements and also place restrictions on the declaration and payment of dividends and other distributions.

As of June 30, 2023, the Company had investable assets of $1.06 billion compared to $1.24 billion as of December 31, 2022.

Investable assets are the combined total of our investments, cash and cash equivalents (including restricted cash), loan to a related party and funds withheld receivable.

The decrease in our investable assets is due to the cessation of active reinsurance underwriting of new prospective risks which results in negative operating cash flows as we settle claim payments from the run-off of our reinsurance portfolio liabilities.

As of September 30, 2023, the Company had investable assets of $976.4 million compared to $1.24 billion as of December 31, 2022.

Investable assets include the combined total of our investments, cash and restricted cash including cash equivalents, loan to a related party and funds withheld receivable.

Our investable assets decreased by $266.6 million during the nine months ended September 30, 2023 due to the continued run-off of our reinsurance portfolio liabilities, which results in negative operating cash flows as claim payments are settled primarily from the funds withheld receivable, which decreased by $211.8 million in the nine months ended September 30, 2023.

The regulatory and liquidity requirements of the Company's operating segments are discussed in "Management's Discussion and Analysis of Financial Condition and Results of Operations" section included under Item 7 of our Annual Report on Form 10- K for the year ended December 31, 2022, that was filed with the SEC on March 15, 2023.

6 unchanged sentences

In 2022 and 2023, the Vermont DFR approved an annual dividend program to be paid by Maiden Reinsurance to Maiden NA, with notification to the Vermont DFR as dividends are paid.

Subsequent to that approval, Maiden Reinsurance has paid $31.3 million in dividends to Maiden NA with $6.3 million paid to Maiden NA on a quarterly basis since approval was granted.

Subsequent to that approval, Maiden Reinsurance paid $37.5 million in dividends to Maiden NA with $6.25 million paid to Maiden NA on a quarterly basis since approval was granted.

We may experience continued volatility in our results of operations which could negatively impact our financial condition and create a reduction in the amount of available distribution or dividend capacity from our regulated reinsurance subsidiaries, which would also reduce liquidity.

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Despite the initial inflow of new business from GLS, the run-off of our prior reinsurance business has continued to cause significant negative operating cash flows as we run off the AmTrust Reinsurance segment reserves as shown in the cash flows table below.

While the development of the GLS platform over time should further enhance our ability to pursue the asset and capital management pillars of our business strategy, we continue to expect a trend of negative overall cash flows to continue to reduce our asset base going forward through the remainder of 2023 and beyond.

We continue to expect a trend of negative overall cash flows to continue to reduce our asset base going forward through the remainder of 2023 and beyond.

We expect to use funds from cash and investment portfolios, collected premiums on reinsurance contracts in force or being run-off, investment income and proceeds from investment sales and redemptions to meet our expected claims payments and operational expenses.

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Our expanded asset management strategy can be impacted by both investment specific and broader financial market conditions and may not produce the expected liquidity and cash flows these investments are designed to achieve, or the timing thereof may also be impacted by those factors.

At June 30, 2023, unrestricted cash, cash equivalents and fixed maturity investments were $82.2 million compared to $64.3 million held at December 31, 2022, an increase of $17.9 million during the six months ended June 30, 2023.

This was driven by $11.0 million of net proceeds from sales and redemption of alternative investments including equity method investments and $30.0 million of collateral released by AmTrust, partly offset by $9.6 million for interest payments on the Senior Notes and $0.6 million for common share repurchases under the Company's authorized repurchase plan.

At September 30, 2023, unrestricted cash, cash equivalents and fixed maturity investments were $69.2 million compared to $64.3 million held at December 31, 2022, an increase of $4.9 million during the nine months ended September 30, 2023.

This was primarily driven by $44.0 million of collateral released by AmTrust, partly offset by $14.3 million for interest payments on the Senior Notes, $9.5 million of net purchases for alternative investments including equity method investments, $1.9 million for common share repurchases made under the Company's authorized repurchase plan and employee tax obligations on vesting of restricted shares, as well as payments for general operating expenses.

Please see the related discussion on investing and financing cash flows below.

The table below summarizes our operating, investing and financing cash flows for the six months ended June 30, 2023 and 2022:

For the Six Months Ended June 30, 2023 2022

The table below summarizes our operating, investing and financing cash flows for the nine months ended September 30, 2023 and 2022:

For the Nine Months Ended September 30, 2023 2022

($ in thousands)

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Effect of exchange rate changes on foreign currency cash

Total decrease in cash, restricted cash and cash equivalents $ (19,162) $ (4,619)

(263) (2,152)

Total (decrease) increase in cash, restricted cash and cash equivalents $ (17,094) $ 6,411

Cash Flows used in Operating Activities

Cash flows used in operating activities for the six months ended June 30, 2023 were $63.7 million compared to cash flows used in operating activities of $88.8 million for the six months ended June 30, 2022, a decrease of $25.1 million due to settlement of claim payments to AmTrust using the funds withheld receivable in the current year period whereas cash was primarily used in the prior year period.

Cash flows used in operating activities for the nine months ended September 30, 2023 was $66.0 million compared to cash flows used in operating activities of $99.8 million for the nine months ended September 30, 2022, a decrease of $33.8 million primarily due to the settlement of claim payments to AmTrust using the funds withheld receivable in the current year period whereas cash was primarily used in the prior year period.

Cash Flows provided by Investing Activities

Cash flows provided by investing activities consist primarily of proceeds from the sales and maturities of investments net of payments for investments acquired.

Net cash provided by investing activities was $45.2 million for the six months ended June 30, 2023 compared to $96.3 million for the same period in 2022.

Cash flows provided by investing activities included net proceeds of $11.0 million from alternative investments including equity method investments during the six months ended June 30, 2023 compared to net purchases of $19.1 million for the same respective period in 2022.

For the six months ended June 30, 2023, the proceeds from the sales, maturities and calls exceeded the purchases of fixed maturity securities by $34.2 million compared to net proceeds of $115.5 million for the same respective period in 2022 as the size of the fixed income portfolio continues to decrease as claims payments are made for the runoff of existing reserves for terminated AmTrust Quota Share and the European Hospital Liability Quota Share contracts.

Net cash provided by investing activities was $51.1 million for the nine months ended September 30, 2023 compared to $119.4 million for the same period in 2022.

For the nine months ended September 30, 2023, the proceeds from the sales, maturities and calls exceeded the purchases of fixed maturity securities by $60.7 million compared to net proceeds of $153.6 million for the same respective period in 2022 as the size of the fixed income investment portfolio continues to decrease as claims payments are made for the runoff of existing loss reserves for the terminated AmTrust Quota Share and the European Hospital Liability Quota Share contracts.

Cash flows provided by investing activities included net purchases of $9.5 million for alternative investments including equity method investments during the nine months ended September 30, 2023 compared to net purchases of $34.2 million for the same respective period in 2022.

Cash Flows used in Financing Activities

Cash flows used in financing activities were $0.9 million for the six months ended June 30, 2023 compared to $11.0 million during the same respective period in 2022.

During the six months ended June 30, 2023, the Company repurchased 299,630 common shares at an average price per share of $2.07 under the Company's authorized common share repurchase plan for a total cost of $0.6 million.

During the six months ended June 30, 2022, the Company repurchased 1,581,509 preference shares at an average price per share of $6.31 for an aggregate total consideration of $10.0 million pursuant to the 2021 Preference Share Repurchase Program.

No dividends on common shares were paid during the six months ended June 30, 2023 and 2022.

Cash flows used in financing activities were $2.0 million for the nine months ended September 30, 2023 compared to $11.0 million for the same respective period in 2022.

During the nine months ended September 30, 2023, the Company repurchased 820,105 common shares at an average price per share of $1.93 for a total cost of $1.6 million under the Company's authorized common share repurchase plan.

During the nine months ended September 30, 2022, the Company repurchased 1,581,509 preference shares at an average price per share of $6.31 for an aggregate total consideration of $10.0 million pursuant to the 2021 Preference Share Repurchase Program.

No dividends on common shares were paid during the nine months ended September 30, 2023 and 2022.

Our Board of Directors have not declared any common share dividends since the third quarter of 2018.

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The Company's restrictions, collateral and specific requirements are discussed in " Management's Discussion and Analysis of Financial Condition and Results of Operations " section included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, that was filed with the SEC on March 15, 2023.

At June 30, 2023 and December 31, 2022, restricted cash and cash equivalents and fixed maturity investments used as collateral were $232.6 million and $296.8 million, respectively.

This collateral represents 73.9% and 82.2% of the fair value of total fixed maturity investments, cash, restricted cash and equivalents at June 30, 2023 and December 31, 2022, respectively.

At September 30, 2023 and December 31, 2022, restricted cash and cash equivalents and fixed maturity investments used as collateral were $218.4 million and $296.8 million, respectively.

This collateral represents 75.9% and 82.2% of the fair value of total fixed maturity investments, cash, restricted cash and equivalents at September 30, 2023 and December 31, 2022, respectively.

Cash and Investments

Historically, the investment of our funds had generally been designed to ensure safety of principal while generating current income.

Accordingly, the majority of our funds had been invested in liquid, investment-grade fixed income securities which are all designated as AFS at June 30, 2023.

Accordingly, the majority of our funds had been invested in liquid, investment-grade fixed income securities which are all designated as AFS at September 30, 2023.

As our insurance liabilities continue to run-off and the required capital to operate our business for regulatory purposes decreases, we have modified Maiden Reinsurance’s investment policy which has been approved by the Vermont DFR.

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We categorize these investments as alternative investments which include " Other Investments ", "Equity Securities" , and "Equity Method Investments" on our Condensed Consolidated Balance Sheets.

As of June 30, 2023 and December 31, 2022, our cash and investments consisted of:

June 30, 2023 December 31, 2022

As of September 30, 2023 and December 31, 2022, our cash and investments consisted of:

September 30, 2023 December 31, 2022

($ in thousands)

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As a result of the Exchange, there are no preference shares outstanding.

The market value of our common shares held by Maiden Reinsurance due to the Exchange was $86.9 million at June 30, 2023.

Treasury shares include 42,259,453 common shares owned by Maiden Reinsurance consisting of 41,439,348 shares issued as part of the Exchange and 820,105 shares directly purchased on the open market by Maiden Reinsurance under the Company's authorized repurchase plan.

The market value of our common shares held by Maiden Reinsurance due to the Exchange and common share repurchases was $74.4 million at September 30, 2023.

Cash & Cash Equivalents

At June 30, 2023, we consider the levels of cash and cash equivalents held to be within our targeted ranges.

At September 30, 2023, we consider the levels of cash and cash equivalents held to be within our targeted ranges.

During periods when interest rates experience greater volatility, we have periodically maintained more cash and cash equivalents to better assess current market conditions and opportunities within our defined risk appetite, and may do so in future periods.

Fixed Maturity Investments

The average yield and average duration of our fixed maturities, by asset class, and our cash and cash equivalents (restricted and unrestricted) are as follows at June 30, 2023 and December 31, 2022, respectively:

June 30, 2023 Original or Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Average yield (1)

The average yield and average duration of our fixed maturities, by asset class, and our cash and cash equivalents (restricted and unrestricted) are as follows at September 30, 2023 and December 31, 2022, respectively:

September 30, 2023 Original or Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Average yield (1)

Average duration (2)

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(2) Average duration in years.

During the six months ended June 30, 2023, the yield on the 10-year U.S.

Treasury bond decreased by 7 basis points to 3.81%.

During the nine months ended September 30, 2023, the yield on the 10-year U.S.

Treasury bond increased by 71 basis points to 4.59%.

The 10-year U.S.

Treasury rate is the key risk-free determinant in the fair value of many of the fixed maturity securities in our portfolio.

Treasury yield curve experienced a slight shift during the six months ended June 30, 2023, reflecting concerns of the U.S.

Federal Reserve about reduced but continuing elevated inflation levels and the ongoing strength of the U.S.

The longer end of the U.S.

Treasury yield curve shifted upward during the three months ended September 30, 2023, reflecting continuing concerns of the U.S.

Federal Reserve and financial markets about reduced but continuing elevated inflation levels and the ongoing strength of the U.S.

economy despite significant interest rate increases implemented since 2022.

Central banks globally continue to respond in similar fashion and suggest additional interest rate increases may occur;

however, the significant majority of rate increases by central banks have largely impacted the short end of the yield curve and the limited movement in 10-year U.S.

Treasury yields is consistent with that experience.

The change in the market values of our fixed maturity portfolio during the six months ended June 30, 2023 generated net unrealized gains of $2.8 million which increased our book value per common share by $0.03 during the period.

Central banks globally continue to respond in similar fashion and suggest additional interest rate increases remain possible;

however, the significant majority of rate increases by central banks have largely impacted the short end of the yield curve and despite the movement in 10-year U.S.

Treasury yields during the third quarter of 2023, the U.S.

Treasury yield curve remains inverted as of September 30, 2023.

The change in the market values of our fixed maturity portfolio during the nine months ended September 30, 2023 generated net unrealized gains of $3.1 million which increased our book value per common share by $0.03 during the period.

Current outlooks for global monetary policy indicate that quantitative tightening by central banks in the U.S.

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As noted, the fair value of our fixed maturity investments will fluctuate with changes in interest rates and credit spreads.

We attempt to maintain adequate liquidity in our fixed maturity investments portfolio with a strategy designed to emphasize the preservation of our invested assets and provide sufficient liquidity for the prompt payment of claims and contract liabilities.

We attempt to maintain adequate liquidity in our fixed maturity investments portfolio with a

strategy designed to emphasize the preservation of our invested assets and provide sufficient liquidity for the prompt payment of claims and contract liabilities.

Because we collateralize a significant portion of our insurance liabilities, unanticipated or large increases in interest rates could require us to utilize significant amounts of unrestricted cash and fixed maturity securities to provide additional collateral, which could impact our asset and capital management strategy described herein.

We also monitor the duration and structure of our investment portfolio as discussed below.

As of June 30, 2023, the aggregate hypothetical change in fair value from an immediate 100 basis points increase in interest rates, assuming credit spreads remain constant, in our fixed maturity investments portfolio would decrease the fair value of that portfolio by $7.3 million.

As of September 30, 2023, the aggregate hypothetical change in fair value from an immediate 100 basis points increase in interest rates, assuming credit spreads remain constant, in our fixed maturity investments portfolio would decrease the fair value of that portfolio by $6.4 million.

Actual shifts in interest rates may not change by the same magnitude across the maturity spectrum or on an individual security and, as a result, the impact on the fair value of our fixed maturity securities may be materially different from the resulting change in value described above.

To limit our exposure to unexpected interest rate increases which would reduce the value of our fixed income securities and reduce our shareholders' equity, we attempt to maintain the duration of our fixed maturity investment portfolio combined with our cash and cash equivalents, both restricted and unrestricted, within a reasonable range of the duration of our loss reserves.

At June 30, 2023 and December 31, 2022, these respective durations in years were as follows:

June 30, 2023 December 31, 2022

At September 30, 2023 and December 31, 2022, these respective durations in years were as follows:

September 30, 2023 December 31, 2022

Fixed maturities and cash and cash equivalents

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Reserve for loss and LAE - net of LPT/ADC Agreement reserves 1.4 1.1

During the six months ended June 30, 2023, the weighted average duration of our fixed maturity investment portfolio slightly increased to 1.4 years while the duration for the gross reserve for loss and LAE remained at 5.3 years.

During the nine months ended September 30, 2023, the weighted average duration of our fixed maturity investment portfolio slightly increased to 1.4 years while the duration for the gross reserve for loss and LAE increased to 5.8 years.

The differential in duration between these assets and liabilities may fluctuate over time and in the case of fixed maturities, historically has been affected by factors such as market conditions, changes in asset mix and prepayment speeds in the case of both our U.S.

agency mortgage-backed securities ("Agency MBS") and commercial mortgage-backed securities.

At June 30, 2023, the duration of our loss reserves net of the LPT/ADC Agreement was slightly higher than the duration of our fixed maturity investment portfolio reflecting the increased percentage of European Hospital Liability liabilities which are long-tailed in nature and not subject to the LPT/ADC Agreement which continue to increase in relation to total insurance liabilities as other insurance liabilities continue to run-off more quickly.

At September 30, 2023, the duration of our loss reserves net of the LPT/ADC Agreement was in line with the duration of our fixed maturity investment portfolio.

To limit our exposure to unexpected interest rate increases that could reduce the value of our fixed maturity securities and reduce our shareholders' equity, the Company holds floating rate securities whose fair values are less sensitive to interest rates.

At June 30, 2023 and December 31, 2022, 33.9% and 29.6%, respectively, of our fixed income investments are comprised of floating rate securities.

The floating rate investment holdings at June 30, 2023 and December 31, 2022 were as follows:

June 30, 2023 December 31, 2022

At September 30, 2023 and December 31, 2022, 37.8% and 29.6%, respectively, of our fixed income investments were comprised of floating rate securities which are detailed in the table below:

September 30, 2023 December 31, 2022

($ in thousands) Fair Value % of Total Fair Value % of Total

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(1) Total fixed income investments at fair value include AFS fixed maturities, cash and restricted cash, funds withheld receivable, and loan to related party.

At June 30, 2023 and December 31, 2022, 100.0% of the Company’s U.S.

At September 30, 2023 and December 31, 2022, 100.0% of the Company’s U.S.

agency bond holdings are mortgage-backed.

agency MBS comprise 11.4% of our fixed maturity investment portfolio at June 30, 2023.

agency MBS comprise 11.8% of our fixed maturity investment portfolio at September 30, 2023.

Given their relative size to our total investments, if faster prepayment patterns were to occur over an extended period of time, this could potentially limit the growth in our investment income in certain circumstances or reduce the total amount of investment income we earn.

Additional details on our U.S.

Agency MBS holdings at June 30, 2023 and December 31, 2022 were as follows:

June 30, 2023 December 31, 2022

Agency MBS holdings at September 30, 2023 and December 31, 2022 were as follows:

September 30, 2023 December 31, 2022

($ in thousands) Fair Value % of Total Fair Value % of Total

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Agency MBS $ 30,407 100.0 % $ 34,365 100.0 %

At June 30, 2023 and December 31, 2022, 98.2% and 98.5%, respectively, of our fixed maturity investments consisted of investment grade securities.

At September 30, 2023 and December 31, 2022, 98.1% and 98.5%, respectively, of our fixed maturity investments consisted of investment grade securities.

We define a security as being below investment grade if it has an S&P credit rating of BB+ or equivalent, or less.

Please see " Part I, Item 1 - Notes to Condensed Consolidated Financial Statements (unaudited) Note 4.

Investments " for additional information on the credit rating of our fixed income portfolio.

The security holdings by sector and financial strength rating of our corporate bond holdings at June 30, 2023 and December 31, 2022 were as follows:

June 30, 2023 AAA A+, A, A- BBB+, BBB, BBB- BB+ or lower Fair Value % of Corporate bonds portfolio

Investments " for additional information on the credit rating of our fixed income investment portfolio.

The security holdings by sector and financial strength rating of our corporate bond holdings at September 30, 2023 and December 31, 2022 were as follows:

September 30, 2023 AAA A+, A, A- BBB+, BBB, BBB- BB+ or lower Fair Value % of Corporate bonds portfolio

Corporate bonds

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(1) Ratings as assigned by S&P, or equivalent

The table below includes the Company’s ten largest corporate holdings at fair value and as a percentage of all fixed income securities held as at June 30, 2023;

of which 100.0% are euro denominated, with 55.7% in the Consumer Sector and 26.0% in the Financial Institutions sector.

June 30, 2023 Fair Value % of Holdings Rating (1)

The table below includes the Company’s ten largest corporate holdings at fair value and as a percentage of all fixed income securities held as at September 30, 2023.

The Company's ten largest corporate holdings are 100.0% euro denominated, with 55.6% in the Consumer Sector and 26.1% in the Financial Institutions sector.

September 30, 2023 Fair Value % of Holdings Rating (1)

($ in thousands)

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America Movil SAB DE CV, 1.5%, Due 3/10/2024 5,222 2.0 % A-

Utah Acquisition Sub Inc., 2.25%, Due 11/22/2024 5,283 1.8 % BBB-

Molson Coors Beverage Co., 1.25%, Due 7/15/2024 5,162 2.0 % BBB-

PPG Industries Inc., 0.875%, Due 11/3/2025 5,073 1.8 % BBB+

Utah Acquisition Sub Inc., 2.25%, Due 11/22/2024 5,157 2.0 % BBB-

FBD Insurance PLC, 5.0%, Due 10/9/2028 5,022 1.9 % NA

Kellogg Company, 1.25%, Due 3/10/2025 4,172 1.4 % BBB

PPG Industries Inc., 0.875%, Due 11/3/2025 4,947 1.9 % BBB+

Kellanova, 1.25%, Due 3/10/2025 4,064 1.6 % BBB

BNP Paribas SA, 1.25%, Due 3/19/2025 3,329 1.3 % A-

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(1) Ratings as assigned by S&P, or equivalent

At June 30, 2023 and December 31, 2022, respectively, 100.0% of our non-U.S.

At September 30, 2023 and December 31, 2022, respectively, 100.0% of our non-U.S.

dollar denominated securities were invested in euro denominated bonds.

The net decrease in non-U.S.

denominated fixed maturities is largely due to sales and maturities;

of euro denominated corporate bonds during the six months ended June 30, 2023.

At June 30, 2023 and December 31, 2022, all of the Company's non-U.S.

government issuers have a rating of AA- or higher by S&P.

denominated fixed maturities is largely due to sales and maturities of euro denominated corporate bonds during the nine months ended September 30, 2023.

At September 30, 2023 and December 31, 2022, all of the Company's non-U.S.

government issuers have a rating of AA- or higher by Fitch Ratings.

The Company does not employ any credit default protection against any of the fixed maturities held in non-U.S.

denominated currencies at June 30, 2023 and December 31, 2022, respectively.

At June 30, 2023 and December 31, 2022, respectively, we held the following non-U.S.

denominated currencies at September 30, 2023 and December 31, 2022, respectively.

At September 30, 2023 and December 31, 2022, respectively, we held the following non-U.S.

dollar denominated securities:

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

($ in thousands) Fair Value % of Total Fair Value % of Total

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For our non-U.S.

dollar denominated corporate bonds, the following table summarizes the composition of the fair value of our fixed maturity investments at the dates indicated by ratings at June 30, 2023 and December 31, 2022:

June 30, 2023 December 31, 2022

dollar denominated corporate bonds, the following table summarizes the composition of the fair value of our fixed maturity investments at the dates indicated by ratings at September 30, 2023 and December 31, 2022:

September 30, 2023 December 31, 2022

($ in thousands) Fair Value % of Total Fair Value % of Total

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Private credit investments consist of loans and other debt securities of privately held entities or investment sponsors.

Our alternative investments as of June 30, 2023 and December 31, 2022 consisted of the following asset classes:

June 30, 2023 December 31, 2022

Our alternative investments as of September 30, 2023 and December 31, 2022 consisted of the following asset classes:

September 30, 2023 December 31, 2022

($ in thousands) Carrying Value % of Total Carrying Value % of Total

Publicly traded equity investments $ 84 — % $ 386 0.1 %

Privately held common stocks $ 32,636 11.2 % $ 32,290 11.9 %

Privately held preferred stocks 12,953 4.5 % 10,945 4.0 %

Publicly traded equity investments 58 — % 386 0.1 %

Total equity securities $ 45,647 15.7 % $ 43,621 16.0 %

Hedge fund investments $ — — % $ 5,376 2.0 %

Real estate investments $ 48,524 16.7 % $ 40,944 15.0 %

Hedge fund investments — — % 5,376 2.0 %

Other equity method investments 30,876 10.6 % 33,839 12.4 %

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Total alternative investments $ 291,269 100.0 % $ 272,533 100.0 %

Our allocation to alternative investments increased to 46.0% of our total cash and investments as of June 30, 2023 compared to 43.0% as of December 31, 2022;

and increased to 99.7% of our total shareholders' equity as of June 30, 2023 compared to 95.8% as of December 31, 2022.

Our allocation to alternative investments increased to 50.3% of our total cash and investments as of September 30, 2023 compared to 43.0% as of December 31, 2022;

and increased to 110.6% of our total shareholders' equity as of September 30, 2023 compared to 95.8% as of December 31, 2022.

In addition to the categories described above, we also evaluate our alternative investments by the following asset classes:

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

($ in thousands) Carrying Value % of Total Carrying Value % of Total

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Investment Results

The following table summarizes our investment results for the three and six months ended June 30, 2023 and 2022:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The following table summarizes our investment results for the three and nine months ended September 30, 2023 and 2022:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

11 unchanged sentences

Total net realized (losses) gains (301) 207 (901) 1,382

Net unrealized gains:

Net unrealized gains (losses):

Other investments, including equities 545 (1,779) 3,295 1,466

Total net unrealized gains 1,921 2,158 2,750 3,245

Total net unrealized gains (losses) 545 (1,779) 3,295 1,466

Interest in income (loss) of equity method investments:

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GAAP consolidated financial statements.

The following table details total investment returns for our fixed income investments for the three and six months ended June 30, 2023 and 2022, respectively:

The following table details total investment returns for our fixed income investments for the three and nine months ended September 30, 2023 and 2022, respectively:

Fixed Income Investments (1)

For the Three Months Ended June 30, For the Six Months Ended June 30,

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

Gross investment income $ 7,998 $ 6,800 $ 25,761 $ 19,807

Net realized and unrealized gains (786) (47) (786) 1,096

Net realized and unrealized (losses) gains (301) 96 (1,087) 1,192

Change in AOCI (3)

7 unchanged sentences

Net Investment Returns 1.1 % (0.1) % 3.3 % (1.2) %

The following table details total investment returns for our alternative investments for the three and six months ended June 30, 2023 and 2022, respectively:

The following table details total investment returns for our alternative investments for the three and nine months ended September 30, 2023 and 2022, respectively:

Alternative Investments (2)

For the Three Months Ended June 30, For the Six Months Ended June 30,

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

Gross investment income $ 3,338 $ 403 $ 10,678 $ (23)

Net realized and unrealized (losses) gains 1,931 2,158 2,936 3,324

Net realized and unrealized gains (losses) 545 (1,668) 3,481 1,656

Change in AOCI (3)

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GAAP consolidated financial statements.

The following table details total investment returns for alternative investments by asset class for the six months ended June 30, 2023:

June 30, 2023 Private Equity Private Credit Hedge Funds Alternative Assets Venture Capital Real Estate Total

The following table details total investment returns for alternative investments by asset class for the nine months ended September 30, 2023:

September 30, 2023 Private Equity Private Credit Hedge Funds Alternative Assets Venture Capital Real Estate Total

($ in thousands)

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Annualized Gross Returns 9.7 % 9.1 % 4.1 % 8.2 % 2.7 % (0.2) % 6.7 %

Total investment returns on alternative investments were positive across all asset classes other than real estate and earned a weighted average return of 3.8% during the six months ended June 30, 2023.

The gross and net investment returns were higher compared to the same respective period in 2022 largely due to the interest in income of an equity method investment of $4.2 million, primarily in the alternative asset category, that was recognized during the six months ended June 30, 2023.

The following table details total investment returns for alternative investments by asset class for the six months ended June 30, 2022:

June 30, 2022 Private Equity Private Credit Hedge Funds Alternative Assets Venture Capital Real Estate Total

Total investment returns on alternative investments were positive across all asset classes other than real estate and earned a weighted average return of 5.0% during the nine months ended September 30, 2023.

The gross and net investment returns were higher compared to the same respective periods in 2022 largely due to the interest in income of an equity method investment of $5.5 million, primarily in the alternative asset category, that was recognized during the nine months ended September 30, 2023.

The following table details total investment returns for alternative investments by asset class for the nine months ended September 30, 2022:

September 30, 2022 Private Equity Private Credit Hedge Funds Alternative Assets Venture Capital Real Estate Total

($ in thousands)

6 unchanged sentences

Annualized Gross Returns 3.2 % (0.8) % (27.5) % 15.0 % 29.5 % 0.8 % 3.3 %

Total returns on alternative investments were positive and earned 3.2% during the six months ended June 30, 2022 partly due to the sale of an equity method investment which produced gross returns of $5.8 million and contributed 2.4% to the gross investment returns during the prior year period.

While our alternative investment portfolio continues to be impacted by a rapidly rising interest rate and subsequent economic uncertainty, we believe our alternative investment portfolio remains well positioned to achieve its targeted longer-term returns.

Total returns on alternative investments were positive and earned 2.5% during the nine months ended September 30, 2022 partly due to the sale of an equity method investment in the alternative asset category which produced gross returns of $5.8 million and contributed 2.4% to the gross investment returns during the prior year period.

While our alternative investment portfolio continues to be impacted by a rapidly rising interest rate and subsequent economic and financial markets uncertainty, particularly as regards to timing of monetizing certain investments, we believe our alternative investment portfolio remains well positioned to achieve its targeted longer-term returns.

Other Balance Sheet Changes

The following table summarizes our other material balance sheet changes at June 30, 2023 and December 31, 2022:

($ in thousands) June 30, 2023 December 31, 2022 Change Change %

The following table summarizes our other material balance sheet changes at September 30, 2023 and December 31, 2022:

($ in thousands) September 30, 2023 December 31, 2022 Change in $ Change %

Deferred commission and other acquisition expenses

11 unchanged sentences

The Company's deferred commission and other acquisition expenses decreased by 23.4% and unearned premiums decreased by 24.4% primarily due to the termination of the remaining business under both quota share contracts with AmTrust which have been in run-off since January 1, 2019.

Funds withheld receivable decreased by 30.4% due to the settlement of reinsurance losses payable under the AmTrust Quota Share.

Accrued expenses and other liabilities decreased by 58.4% primarily due to the timing of settlement of reinsurance losses payable due to AmTrust, which have been subsequently settled, and also due to a decrease in underwriting-related derivative liability on GLS policies to $4.0 million at June 30, 2023 compared to $14.6 million at December 31, 2022 as the acceleration of covered payments triggered coverage in excess of the contracts risk margin.

Funds withheld receivable decreased by 48.0% due to settlement of reinsurance losses payable under the AmTrust Quota Share.

Accrued expenses and other liabilities decreased by 36.1% primarily due to settlement of reinsurance losses payable due to AmTrust, and a decrease in the underwriting-related derivative liability on GLS policies to $4.0 million at September 30, 2023 compared to $14.6 million at December 31, 2022 as the acceleration of covered payments triggered coverage in excess of the contracts risk margin.

The Company's reserve for loss and LAE decreased by 19.4% primarily due to continued settlement of loss reserves for AmTrust Reinsurance contracts.

The deferred gain on retroactive reinsurance increased by $12.3 million or 25.8% compared to December 31, 2022 driven by net adverse prior year loss development of $6.1 million for the six months ended June 30, 2023 reported in the AmTrust Reinsurance segment.

The adverse development of $6.1 million was adjusted to remove the $8.6 million favorable impact resulting from non-subject exposures and the impact of currency fluctuation from non-U.S.

cessions received from AmTrust and decreased by $2.8 million for movement on certain Workers Compensation losses that were commuted to AmTrust in 2019 that inure to the benefit of Cavello as opposed to the Company under the terms of the LPT/ADC Agreement.

The deferred gain on retroactive reinsurance increased by $11.1 million or 23.3% compared to December 31, 2022 driven by net adverse prior year loss development of $12.0 million for the nine months ended September 30, 2023 reported for the AmTrust Reinsurance segment as these losses are largely covered by the LPT/ADC Agreement with Cavello.

Capital Resources

During the six months ended June 30, 2023, book value per common share decreased by 5.4% to $2.65 and diluted book value per common share decreased by 6.1% to $2.62, compared to December 31, 2022.

This was largely due to the net loss attributable to Maiden common shareholders of $14.3 million during the six months ended June 30, 2023 and an opening allowance for expected credit losses of $5.5 million in the beginning retained earnings on January 1, 2023;

During the nine months ended September 30, 2023, book value per common share decreased by 7.1% to $2.60 and diluted book value per common share decreased by 7.5% to $2.58, compared to December 31, 2022.

This was largely due to the net loss attributable to Maiden common shareholders of $17.8 million during the nine months ended September 30, 2023 and an opening allowance for expected credit losses of $5.5 million in the beginning retained earnings on January 1, 2023;

partly offset by a net increase in AOCI of $2.3 million during the period.

Capital resources consist of funds deployed in support of our operations.

The following table shows the movement in our capital resources at June 30, 2023 and December 31, 2022:

June 30, 2023 December 31, 2022 Change Change (%)

The following table shows the movement in our capital resources at September 30, 2023 and December 31, 2022:

September 30, 2023 December 31, 2022 Change in $ Change (%)

($ in thousands)

13 unchanged sentences

• net increase in AOCI of $2.3 million which arose due to:

(1) net unrealized gains on investment of $2.8 million mainly from our fixed income investment portfolio relating to market price movements in the six months ended June 30, 2023, and (2) an increase in cumulative translation adjustments of $1.3 million in the six months ended June 30, 2023 due to the impact of the U.S.

(1) net unrealized gains on investment of $3.1 million mainly from our fixed income investment portfolio relating to market price movements in the nine months ended September 30, 2023, and (2) an decrease in cumulative translation adjustments of $0.7 million in the nine months ended September 30, 2023 due to the impact of the U.S.

dollar depreciation on the re-measurement of net assets denominated in British pound and euro;

• accumulated deficit increased by $19.8 million due to a net loss of $14.3 million for the six months ended June 30, 2023 and the opening allowance for expected credit losses on other investments, reinsurance recoverable, reinsurance balances receivable and funds withheld receivable of $5.5 million for the six months ended June 30, 2023 which decreased opening retained earnings;

• accumulated deficit increased by $23.3 million due to a net loss of $17.8 million for the nine months ended September 30, 2023 and the opening allowance for expected credit losses on other investments, reinsurance recoverable, reinsurance balances receivable and funds withheld receivable of $5.5 million for the nine months ended September 30, 2023 which decreased opening retained earnings;

• treasury shares increased by $1.9 million due to common shares repurchased under the Company's authorized common share repurchase plan as well as repurchases for tax withholding in respect of tax obligations on the vesting of both non-performance-based and discretionary performance-based restricted shares.

2 unchanged sentences

" Financial Statements and Supplementary Data" of our Annual Report on Form 10-K for a discussion of the equity instruments issued by the Company as at December 31, 2022.

Book value and diluted book value per common share at June 30, 2023 and December 31, 2022 were as follows:

($ in thousands except share and per share data) June 30, 2023 December 31, 2022

Book value and diluted book value per common share at September 30, 2023 and December 31, 2022 were as follows:

($ in thousands except share and per share data) September 30, 2023 December 31, 2022

Ending common shareholders’ equity

14 unchanged sentences

On February 21, 2017, the Company's Board of Directors approved the repurchase of up to $100.0 million of the Company's common shares from time to time at market prices.

During the three and six months ended June 30, 2023, Maiden Reinsurance repurchased 299,630 common shares from the open market at an average price per share of $2.07 under the Company's share repurchase plan.

The Company has a remaining authorization of $73.6 million for common share repurchases at June 30, 2023.

No repurchases were made during the three and six months ended June 30, 2022 under the common share repurchase plan.

There were no changes in the Company’s Senior Notes at June 30, 2023 compared to December 31, 2022 other than repurchases as discussed further below.

The Company did not enter into any short-term borrowing arrangements during the six months ended June 30, 2023.

During the three and nine months ended September 30, 2023, Maiden Reinsurance repurchased 520,475 and 820,105 common shares, respectively, from the open market at an average price per share of $1.86 and $1.93, respectively, under the Company's share repurchase plan.

The Company's remaining authorization is $72.7 million for common share repurchases at September 30, 2023.

No repurchases were made during the three and nine months ended September 30, 2022 under the common share repurchase plan.

There were no changes in the Company’s Senior Notes at September 30, 2023 compared to December 31, 2022 other than repurchases as discussed further below.

The Company did not enter into any short-term borrowing arrangements during the nine months ended September 30, 2023.

Please refer to " Notes to Condensed Consolidated Financial Statements (unaudited) Note 7.

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Long-Term Debt " included under Part I Item 1 " Financial Information" of this Form 10-Q, on May 3, 2023, the Company's Board of Directors approved the repurchase, including the repurchase by Maiden Reinsurance in accordance with its investment guidelines, of up to $100.0 million of the Company's Senior Notes from time to time at market prices in open market purchases or as may be privately negotiated.

During the three and six months ended June 30, 2023, Maiden Reinsurance repurchased 5,567 notes of the 2013 Senior Notes at an average price per unit of $17.10 for a total cost of $95.2 thousand.

Total interest and amortization expenses for the three and six months ended June 30, 2023 were partly offset by a gain of $39.9 thousand realized on the repurchase of the 2013 Senior Notes.

The Company has a remaining authorization of $99.9 million for such repurchases at June 30, 2023.

During the nine months ended September 30, 2023, Maiden Reinsurance repurchased 5,567 notes of the 2013 Senior Notes at an average price per unit of $17.10 for a total cost of $95.2 thousand.

Total interest and amortization expenses for the nine months ended September 30, 2023 were partly offset by a gain of $39.9 thousand realized on the repurchase of the 2013 Senior Notes.

The Company has a remaining authorization of $99.9 million for such repurchases at September 30, 2023.

Maiden Holdings does not have any significant operations or assets other than ownership of the shares of our subsidiaries.

1 unchanged sentence

Factors that may affect payments to holders of the 2013 Senior Notes include restrictions on the payments of dividends by Maiden Reinsurance to Maiden NA which provides the sole source of income for interest payments on the 2013 Senior Notes.

In 2022 and 2023, the Vermont DFR approved an annual dividend program to be paid by Maiden Reinsurance to Maiden NA, with notification to the Vermont DFR as dividends are paid.

Subsequent to those approvals, Maiden Reinsurance paid total dividends of $31.3 million to Maiden NA as of June 30, 2023.

In 2022 and 2023, the Vermont DFR approved an annual dividend program from Maiden Reinsurance to Maiden NA, with notification to the Vermont DFR as dividends are paid.

Subsequent to those approvals, Maiden Reinsurance paid total dividends of $37.5 million to Maiden NA as of September 30, 2023.

The summarized financial information below has been presented on a combined basis for the issuer Maiden NA and the guarantor Maiden Holdings, excluding all other subsidiaries.

2 unchanged sentences

Intercompany balances with subsidiaries that are not issuers or guarantors and any related party transactions were separately disclosed below and are not included in the total assets and total liabilities presented for Maiden NA and Maiden Holdings.

The net income (loss) for Maiden NA and Maiden Holdings was due to interest and amortization expenses on the Senior Notes as well as general and administrative expenses.

The net income (loss) in Maiden NA also reflects income tax expense incurred for the respective periods.

Summarized financial information of Maiden NA and Maiden Holdings as of June 30, 2023 and for the three and six months ended June 30, 2023 were as follows:

The net loss for Maiden NA and Maiden Holdings was due to interest and amortization expenses on the Senior Notes as well as general and administrative expenses.

The net loss in Maiden NA also reflects income tax expense incurred for the respective periods.

Summarized financial information of Maiden NA and Maiden Holdings as of September 30, 2023 and for the three and nine months ended September 30, 2023 were as follows:

Maiden NA Maiden Holdings

6 unchanged sentences

Total revenue for the quarter-to-date period 1,230 3

Net income (loss) for the quarter-to-date period 851 (7,258)

Net loss for the quarter-to-date period (3,181) (8,253)

Total revenue for year-to-date period 2,310 8

Net loss for year-to-date period (4,294) (25,273)

The ratio of Debt to Total Capital Resources at June 30, 2023 and December 31, 2022 was computed as follows:

($ in thousands) June 30, 2023 December 31, 2022

The ratio of Debt to Total Capital Resources at September 30, 2023 and December 31, 2022 was computed as follows:

($ in thousands) September 30, 2023 December 31, 2022

Senior notes - principal amount

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The Company is not bound to such guarantees without its express authorization.

As discussed above, at June 30, 2023, guarantees of $43.1 million have been provided to lenders by the Company on behalf of the real estate joint venture, however, the likelihood of the Company incurring any losses pertaining to project level financing guarantees was determined to be remote.

As discussed above, at September 30, 2023, guarantees of $55.1 million have been provided to lenders by the Company on behalf of the real estate joint venture, however, the likelihood of the Company incurring any losses pertaining to project level financing guarantees was determined to be remote.

Therefore, no liability has been accrued under ASC 450-20.

3 unchanged sentences

The calculation, reconciliation to nearest GAAP measure and discussion of relevant non-GAAP measures used by management are as follows:

Non-GAAP operating income was $4.5 million for the three months ended June 30, 2023 compared to non-GAAP operating income of $16.6 million for the same period in 2022, largely due to $24.7 million of gains from repurchase of our preference shares in the second quarter of 2022.

Excluding the gain from the repurchase of preference shares in the second quarter of 2022, our non-GAAP operating income increased by $12.6 million compared to the same period in 2022 largely due to higher non-GAAP underwriting income as discussed below.

Non-GAAP underwriting income of $1.5 million for the three months ended June 30, 2023, compared to a non-GAAP underwriting loss of $8.6 million for the same period in 2022.

The non-GAAP underwriting results in both respective periods included underwriting results in the AmTrust Reinsurance segment not covered by the LPT/ADC Agreement, specifically the run-off of the AmTrust Quota Share with losses occurring after December 31, 2018, as well as loss development under the European Hospital Liability Quota Share, and underwriting losses in the Diversified Reinsurance segment of $3.1 million for the three months ended June 30, 2023 compared to a loss of $1.3 million for the same period in 2022.

Non-GAAP operating loss was $3.4 million for the six months ended June 30, 2023, compared to non-GAAP operating income of $9.7 million for the same respective period in 2022 which included $28.2 million of gains from the repurchase of our preference shares in 2022.

Non-GAAP underwriting loss of $5.2 million for the six months ended June 30, 2023 compared to non-GAAP underwriting loss of $11.2 million for the same period in 2022.

The non-GAAP underwriting loss in both respective periods included underwriting results in the AmTrust Reinsurance segment not covered by the LPT/ADC Agreement, specifically the run-off of the AmTrust Quota Share with losses occurring after December 31, 2018, as well as loss development under the European Hospital Liability Quota Share, and an underwriting loss in Diversified Reinsurance segment of $5.1 million for the six months ended June 30, 2023 compared to underwriting income of $0.2 million for the same period in 2022.

Non-GAAP operating income (loss) and Non-GAAP diluted operating income (loss) per share available to common shareholders

Non-GAAP operating income and Non-GAAP diluted operating income per share available to common shareholders can be reconciled to the nearest U.S.

Non-GAAP operating loss and Non-GAAP diluted operating loss per share available to common shareholders

Non-GAAP operating loss and Non-GAAP diluted operating loss per share attributable to common shareholders can be reconciled to the nearest U.S.

GAAP financial measure as follows:

For the Three Months Ended June 30, 2023 2022

For the Three Months Ended September 30, 2023 2022

($ in thousands except per share data)

Net (loss) income (attributable) available to Maiden common shareholders $ (2,933) $ 25,752

Net loss attributable to Maiden common shareholders $ (3,527) $ (8,160)

Add (subtract):

Net realized and unrealized investment gains (1,145) (2,111)

Foreign exchange and other losses (gains) 2,621 (6,586)

Net realized and unrealized investment (gains) losses (244) 1,572

Foreign exchange and other gains (4,594) (8,586)

Interest in (income) loss of equity method investments (2,190) 373

Change in deferred gain on retroactive reinsurance under the LPT/ADC Agreement (1,192) (6,259)

Non-GAAP operating income $ 4,467 $ 16,633

Diluted (loss) earnings per share (attributable) available to common shareholders $ (0.03) $ 0.29

Non-GAAP operating loss $ (11,747) $ (21,060)

Diluted loss per share attributable to common shareholders $ (0.03) $ (0.09)

Add (subtract):

Net realized and unrealized investment gains (0.01) (0.02)

Foreign exchange and other losses (gains) 0.02 (0.08)

Net realized and unrealized investment (gains) losses (0.01) 0.02

Foreign exchange and other gains (0.05) (0.10)

Interest in (income) loss of equity method investments (0.02) —

Change in deferred gain on retroactive reinsurance under the LPT/ADC Agreement (0.01) (0.07)

Non-GAAP diluted operating income per share available to common shareholders

Non-GAAP diluted operating loss per share attributable to common shareholders

$ (0.12) $ (0.24)

For the Six Months Ended June 30, 2023 2022

For the Nine Months Ended September 30, 2023 2022

($ in thousands except per share data)

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Change in deferred gain on retroactive reinsurance under the LPT/ADC Agreement 11,108 (10,722)

Non-GAAP operating (loss) income $ (3,426) $ 9,698

Non-GAAP operating loss $ (15,173) $ (11,362)

Diluted (loss) earnings per share (attributable) available to common shareholders $ (0.18) $ 0.22

4 unchanged sentences

Change in deferred gain on retroactive reinsurance under the LPT/ADC Agreement 0.11 (0.12)

Non-GAAP diluted operating (loss) income per share (attributable) available to common shareholders

Non-GAAP diluted operating loss per share attributable to common shareholders

$ (0.15) $ (0.13)

Non-GAAP operating loss was $11.7 million for the three months ended September 30, 2023 compared to non-GAAP operating loss of $21.1 million for the same period in 2022.

Non-GAAP operating loss was $15.2 million for the nine months ended September 30, 2023, compared to a non-GAAP operating loss of $11.4 million for the same respective period in 2022 which included gains of $28.2 million from the repurchase of our preference shares in 2022.

The non-GAAP operating results were primarily driven by non-GAAP underwriting results in the AmTrust Reinsurance segment as discussed further below.

Non-GAAP Underwriting Results

The non-GAAP underwriting results for the three and six months ended June 30, 2023 and 2022 are as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

The non-GAAP underwriting results for the three and nine months ended September 30, 2023 and 2022 are as follows:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

2 unchanged sentences

Net premiums earned $ 12,479 $ 12,251 $ 32,520 $ 23,816

Other insurance revenue, net 78 469 19 520

Other insurance (expense) revenue, net (16) 368 3 888

Non-GAAP net loss and LAE (1)

2 unchanged sentences

General and administrative expenses (2,877) (2,422) (9,925) (9,288)

Non-GAAP underwriting income (loss) (1)

Non-GAAP underwriting loss (1)

$ (12,102) $ (18,886) $ (17,317) $ (30,134)

(1) Non-GAAP underwriting income (loss) and non-GAAP net loss and LAE for the three and six months ended June 30, 2023 and 2022 are adjusted for prior year reserve development subject to the LPT/ADC Agreement.

(1) Non-GAAP underwriting loss and non-GAAP net loss and LAE for the three and nine months ended September 30, 2023 and 2022 are adjusted for prior year reserve development subject to the LPT/ADC Agreement.

Please see "Key Financial Measures" section for the definitions of Non-GAAP underwriting loss and net loss and LAE.

The non-GAAP underwriting results above are summarized by segment for the three and nine months ended September 30, 2023 and 2022 in the table below:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

Diversified Reinsurance underwriting (loss) income $ (2,541) $ 40 $ (7,648) $ 264

AmTrust Reinsurance underwriting loss (8,369) (12,667) (20,777) (19,676)

(favorable) adverse prior year loss development covered under the LPT/ADC Agreement (1,192) (6,259) 11,108 (10,722)

Non-GAAP AmTrust Reinsurance underwriting loss (9,561) (18,926) (9,669) (30,398)

Non-GAAP underwriting loss $ (12,102) $ (18,886) $ (17,317) $ (30,134)

The non-GAAP underwriting results include the impact of prior year loss reserve development under the AmTrust Quota Share which is fully recoverable from Cavello under the LPT/ADC Agreement to show the ultimate economic benefit to the Company.

As shown in the table above, adjusted for the increase in the deferred gain under the LPT/ADC Agreement of $10.7 million and $12.3 million during the three and six months ended June 30, 2023, respectively, the non-GAAP underwriting income was $1.5 million and an underwriting loss of $5.2 million, respectively.

This compared to a non-GAAP underwriting loss of $8.6 million and $11.2 million, respectively, when adjusted for the decrease of $3.5 million and $4.5 million in the deferred gain under the LPT/ADC Agreement during the three and six months ended June 30, 2022, respectively.

The improvement in non-GAAP underwriting results was primarily the result of lower incurred losses in the AmTrust Reinsurance segment not covered by the LPT/ADC Agreement, specifically the run-off of the AmTrust Quota Share for losses occurring after December 31, 2018.

The non-GAAP underwriting results were also driven by the Diversified Reinsurance segment which had an underwriting loss of $3.1 million and $5.1 million for the three and six months ended June 30, 2023, respectively, compared to a loss of $1.3 million and income of $0.2 million for the same respective periods in 2022.

As shown in the table above, adjusted for the decrease in the deferred gain under the LPT/ADC Agreement of $1.2 million and increase of $11.1 million during the three and nine months ended September 30, 2023, respectively, the non-GAAP underwriting loss was $12.1 million and $17.3 million, respectively.

This compared to a non-GAAP underwriting loss of $18.9 million and $30.1 million, respectively, when adjusted for the decrease of $6.3 million and $10.7 million in the deferred gain under the LPT/ADC Agreement during the three and nine months ended September 30, 2022, respectively.

The non-GAAP underwriting results above were due to incurred losses in the AmTrust Reinsurance segment not covered by the LPT/ADC Agreement, specifically the run-off of the AmTrust Quota Share for losses occurring after December 31, 2018, and net adverse loss development in the European Hospital Liability Quota Share.

Please refer to the AmTrust Reinsurance segment results under Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Quarterly Report on Form 10-Q for further discussion of these underwriting results.

The non-GAAP underwriting results in the table above were also driven by the Diversified Reinsurance segment which had an underwriting loss of $2.5 million and $7.6 million for the three and nine months ended September 30, 2023, respectively, compared to income of $40.0 thousand and $0.3 million for the same respective periods in 2022.

Please refer to the Diversified Reinsurance segment results under Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Quarterly Report on Form 10-Q for further discussion of these underwriting results.

Non-GAAP Net Loss and LAE

Adjusted for the increase in the deferred gain for the LPT/ADC Agreement for the three and six months ended June 30, 2023, the non-GAAP net loss and LAE decreased by $10.7 million and $12.3 million, respectively, as these amounts included adverse loss experience for AmTrust Quota Share reserves under the LPT/ADC Agreement which are ultimately recoverable from Cavello.

Adjusted for the decrease in the deferred gain for the LPT/ADC Agreement for the three and six months ended June 30, 2022, the non-GAAP net loss and LAE increased by $3.5 million and $4.5 million, respectively, as these amounts included favorable loss experience for AmTrust Quota Share reserves under the LPT/ADC Agreement which are ultimately recoverable from Cavello.

Adjusted for the decrease and increase in the deferred gain for the LPT/ADC Agreement for the three and nine months ended September 30, 2023, respectively, the non-GAAP net loss and LAE increased by $1.2 million and decreased by $11.1 million, respectively, as these amounts included adverse loss experience for AmTrust Quota Share reserves under the LPT/ADC Agreement which are ultimately recoverable from Cavello.

Adjusted for the decrease in the deferred gain for the LPT/ADC Agreement for the three and nine months ended September 30, 2022, the non-GAAP net loss and LAE increased by $6.3 million and $10.7 million, respectively, as these amounts included favorable loss experience for AmTrust Quota Share reserves under the LPT/ADC Agreement which are ultimately recoverable from Cavello.

These adjustments are reflected in the calculation of non-GAAP Loss and LAE below:

For the Three Months Ended June 30, For the Six Months Ended June 30,

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

1 unchanged sentence

$ 15,156 $ 17,426 $ 36,503 $ 22,017

adverse (favorable) prior year loss development covered under the LPT/ADC Agreement 10,727 (3,463) 12,300 (4,463)

(favorable) adverse prior year loss development covered under the LPT/ADC Agreement (1,192) (6,259) 11,108 (10,722)

Non-GAAP net loss and LAE

1 unchanged sentence

Adjusted Shareholders' Equity, Adjusted Total Capital Resources, Adjusted Book Value per Common Share, and Ratio of Debt to Total Adjusted Capital Resources

The Adjusted Shareholders' Equity, Adjusted Total Capital Resources and Adjusted Book Value per Common Share at June 30, 2023 and December 31, 2022 reflect the addition of the unamortized deferred gain under the LPT/ADC Agreement to the GAAP shareholders' equity as depicted in the computations below.

The deferred gain under the LPT/ADC Agreement was $57.7 million at June 30, 2023 compared to $45.4 million at December 31, 2022, which relates to loss reserves subject to that agreement that are fully recoverable from Cavello.

The increase in the unamortized deferred gain under the LPT/ADC Agreement for the six months ended June 30, 2023 is attributable to $12.3 million in net loss and LAE recognized as adverse loss development in the Company's GAAP income statement for policies subject to the LPT/ADC Agreement.

The Adjusted Shareholders' Equity, Adjusted Total Capital Resources and Adjusted Book Value per Common Share at September 30, 2023 and December 31, 2022 reflect the addition of the unamortized deferred gain under the LPT/ADC Agreement to the GAAP shareholders' equity as depicted in the computations below.

The deferred gain under the LPT/ADC Agreement was $56.5 million at September 30, 2023 compared to $45.4 million at December 31, 2022, which relates to loss reserves subject to that agreement that are fully recoverable from Cavello.

The increase in the unamortized deferred gain under the LPT/ADC Agreement for the nine months ended September 30, 2023 is attributable to $11.1 million in net loss and LAE recognized as adverse loss development in the Company's GAAP income statement for policies subject to the LPT/ADC Agreement.

We believe the inclusion of this unamortized deferred gain under these metrics better reflects the ultimate economic benefit of the LPT/ADC Agreement, which will improve the Company's shareholders' equity over the settlement period under the terms of the agreement.

Reconciliation of shareholders' equity to Adjusted shareholders' equity and Adjusted Total Capital Resources

The following table computes adjusted shareholders' equity and adjusted total capital resources by recognizing the unamortized deferred gain under the LPT/ADC Agreement at June 30, 2023 and December 31, 2022:

($ in thousands) June 30, 2023 December 31, 2022 Change Change %

The following table computes adjusted shareholders' equity and adjusted total capital resources by recognizing the unamortized deferred gain under the LPT/ADC Agreement at September 30, 2023 and December 31, 2022:

($ in thousands) September 30, 2023 December 31, 2022 Change in $ Change %

Total shareholders' equity

7 unchanged sentences

Non-GAAP Operating ROACE

Non-GAAP Operating ROACE for the three and six months ended June 30, 2023 and 2022 was as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,

Non-GAAP Operating ROACE for the three and nine months ended September 30, 2023 and 2022 was as follows:

For the Three Months Ended September 30, For the Nine Months Ended September 30,

($ in thousands) 2023 2022 2023 2022

Non-GAAP operating income (loss) $ 4,467 $ 16,633 $ (3,426) $ 9,698

Non-GAAP operating loss $ (11,747) $ (21,060) $ (15,173) $ (11,362)

Opening adjusted shareholders’ equity 326,998 269,658 329,987 274,990

4 unchanged sentences

Reconciliation of Book Value per Common Share to Adjusted Book Value per Common Share

The adjusted book value per common share as reconciled for the recognition of the unamortized deferred gain under the LPT/ADC Agreement at June 30, 2023 and December 31, 2022 was computed as follows:

June 30, 2023 December 31, 2022

The adjusted book value per common share as reconciled for the recognition of the unamortized deferred gain under the LPT/ADC Agreement at September 30, 2023 and December 31, 2022 was computed as follows:

September 30, 2023 December 31, 2022

Book value per common share

6 unchanged sentences

This measure is calculated using the total principal amount of debt divided by the sum of adjusted total capital resources as computed in the table above.

The ratio of Debt to Adjusted Total Capital Resources at June 30, 2023 and December 31, 2022 was computed as follows:

($ in thousands) June 30, 2023 December 31, 2022

The ratio of Debt to Adjusted Total Capital Resources at September 30, 2023 and December 31, 2022 was computed as follows:

($ in thousands) September 30, 2023 December 31, 2022

Senior notes - principal amount

15 unchanged sentences

To the extent that these exposures are not fully hedged or the hedges are ineffective, our results of operations or equity may be adversely affected.

At June 30, 2023, no such hedges or hedging strategies were in force or had been entered into.

At September 30, 2023, no such hedges or hedging strategies were in force or had been entered into.

We measure monetary assets and liabilities denominated in foreign currencies at period end exchange rates, with the resulting foreign exchange gains and losses recognized in the unaudited Condensed Consolidated Statements of Income.

1 unchanged sentence

The effect of the translation adjustments for foreign operations is included in AOCI.

Net foreign exchange losses of $2.6 million and $4.7 million were generated during the three and six months ended June 30, 2023, respectively, compared to net foreign exchange gains of $7.9 million and $11.9 million for the three and six months ended June 30, 2022, respectively.

The decrease in foreign exchange results for both the three and six months ended June 30, 2023 compared to the same respective periods in 2022 was due to a decline in the value of the U.S.

dollar against the euro and the British pound.

Our non-USD denominated liabilities at June 30, 2023 included reserve for net loss and LAE of $313.5 million.

Our foreign currency asset exposures at June 30, 2023 include $172.1 million of fixed maturity securities managed by our investment managers who have the discretion to hold foreign currency exposures as part of their total return strategy as well as $22.6 million of equity method real estate investments denominated in Canadian dollars.

Net foreign exchange gains of $4.6 million and losses of $0.1 million were generated during the three and nine months ended September 30, 2023, respectively, compared to net foreign exchange gains of $8.6 million and $20.5 million for the three and nine months ended September 30, 2022, respectively.

The decrease in foreign exchange gains for both the three and nine months ended September 30, 2023 compared to the same respective periods in 2022 was due to a decline in the value of the U.S.

dollar relative to the euro and the British pound.

At September 30, 2023, net foreign exchange gains and losses were primarily driven by exposures to euro, British pound and other non-USD denominated net loss reserves and insurance related liabilities in excess of foreign currency assets.

Our non-USD denominated liabilities at September 30, 2023 included reserve for net loss and LAE of $276.3 million.

Our foreign currency asset exposures at September 30, 2023 include $167.2 million of fixed maturity securities managed by our investment managers who have the discretion to hold foreign currency exposures as part of their total return strategy as well as $26.0 million of equity method real estate investments denominated in Canadian dollars.

Effects of Inflation

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Off-Balance Sheet Arrangements

At June 30, 2023, we did not have any off-balance sheet arrangements as defined by Item 303(a) (4) of Regulation S-K.

At September 30, 2023, we did not have any off-balance sheet arrangements as defined by Item 303(a) (4) of Regulation S-K.

Recent Accounting Pronouncements

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis