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Bryan Petrucelli

Thanks, Mike.
Another solid quarter with net operating earnings increasing by 19.4%. The 73.4% combined ratio for the quarter included 2.6 points from net favorable prior year loss reserve development compared to 2.3 points last year.
With 2.2 points in cat losses this year, primarily from Hurricane Milton compared to less than a half point in Q4 of last year.
We produced a 21.1% expense ratio in the fourth quarter compared to 19.9% last year.
The expense ratio will fluctuate from quarter to quarter, and I point you to the full year expense ratio is a better measure. You can see that our 20.6% expense ratio for the full year compares favorably with the 20.8% last year.
That being said, the higher Q4 expense ratio is due primarily to higher variable compensation offset by higher sing commissions.
On the investment side, net investment income increased by 37.8% in the fourth quarter over the last year as a result of continued growth in the investment portfolio generated from strong operating cash flows and higher interest rates. The annualized gross return was 4.4% for the year so far compared to 4% last year.
New money yields are averaging in a low 5% range and with both yields around 4.5%, so we should see some continued investment income benefit from those higher rates as we move forward. Additionally, we're gradually increasing our allocation of common stock from 8% to 10% of cash and invested assets, and we'll eventually increase the allocation to 12% over the next year or so.
Diluted operating earnings per share continues to improve and was $4.62 per share for the quarter compared to $3.87 per share for the fourth quarter of 2023.
Just a couple of comments regarding capital management. We repurchased $10 million in shares during the 4th quarter.
We would expect similar modest levels of repurchases each quarter on a routine basis with larger purchases made opportunistically from time to time.
And with that, I'll pass it over to Brian Haney. Thanks, Brian.

Brian Haney

The fourth quarter saw growth in our gross premium of 12.2% consistent with our expectation of 10 to 20% growth over the long term.
Our casualty underwriting divisions grew at 15% for the quarter, while property divisions grew at 6%.
Rate declines on larger layered property transactions in particular had a dampening effect on the growth rate in the quarter as that market is normalized after a period of crisis pricing conditions in the prior years.
Casualty is still seeing steady growth overall with excess casualty, commercial auto, and general liability among the fastest growing divisions and management and professional liability among the most competitive.
Catastrophe losses in the fourth quarter were modest $8 million pre-tax, and as Mike mentioned, our California wildfire estimate is $25 million pre-tax.
As a reminder, we write catastrophe exposed property business including wildfire, hurricane, and earthquake, and some flood.
But in doing so, we always seek to balance the margin in that business with the potential for excessive volatility.
In addition to a careful underwriting approach, we employ a sophisticated risk management strategy. And a robust reinsurance program to limit volatility, and we've been successful in that approach for many years now.
We don't expect recent catastrophe events in the industry will be enough to change the overall market, but it may create more opportunities in personal insurance, which we are already leaning into.
Part of Kinsale's growth over the years has been due to a regular expansion of our product lines into adjacent markets. Most recently, we created a new agribusiness underwriting unit that focuses on opportunities in the farm, ranch, and related spaces. This is part of our ongoing effort to gradually expand our product line so that we can offer solutions for all tough to place ES accounts across the US, no matter what coverage or sector of the economy.
New business emission growth was 17% for the quarter, down from 23% in the third quarter.
This number is subject to some volatility, but we in general view submissions as a leading indicator of growth, and so we see that, submission growth rate is a positive signal.
Overall rates for the quarter were about flat. Excess casualty, commercial auto and construction were up high single digits, while larger layered property accounts were down mid to highkes. All other lines were somewhere in between.
We are being more aggressive in pricing in some select areas because the margins are so high that the trade-off between a lower rate and more growth is worthwhile. Keep in mind our 29% operating ROE.
Would imply that half of our book is producing margins above that. So by trading away some of that excess profitability on some specific lines of business, we can drive better growth and maximize wealth creation for our stockholders over time.
Overall, we remain optimistic. The results are good. Our growth prospects are good, and as a low cost provider in our space, we have a durable competitive advantage which will allow us to continually gradually take market share from our higher expense competitors while continuing to deliver strong returns and build wealth for our investors. With that, I'll hand it back over to my.

Michael Kehoe

Thanks, Brian operator, we're ready for questions now.

Question and Answer Session

Operator

(Operator Instructions) Michael Zaremski, BMO Capital Markets.

Michael Zaremski

Hey, good morning.
So back to the commentary on the the market environment.
Is, I think you, it sounds like, larger shared account property, had a one of the more meaningful impacts on growth this quarter. If you can kind of confirm that or I don't know, I think let's wait for the 10K to see the mix of casualty versus property if you were able to preview it and just along those lines to how's pricing looking in in kind of small commercial casualty.

Michael Kehoe

Mike, this is Mike.
I think our mix of business generally is 1/3, 2/3, 1/3 property, 2/3 casualty.
The larger layer deals, as Brian indicated, are under some competitive pressure after, just seeing a tremendous inflation in rates over the prior several years. So we think that's a The normal evolution of that market, the returns have been extraordinary, and it makes sense. A lot of capitals flowed back into that space. Our small property divisions are still growing very rapidly and we're getting positive rating increases there. So we're we're upbeat on property, small casualty, I think as Brian said, it kind of varies by by product line. So on construction, commercial auto ex access, very healthy rate increases.
Other lines like management liability, professional liability, where we've seen some extraordinary levels of profitability, we're trying to be incrementally more aggressive.

Michael Zaremski

Got it.
Okay, and that's helpful. Maybe switching gears to the point of excellent profit margins. So you, you're saying on this call you in the past too that you're willing to trade off, less excellent profits for, what sounds like more growth. Is that actually, are you, are we actually see because I know there's, an overlaying impact maybe from large property having a negative impact on. On overall growth, but would you say that We might be reaching a trough in terms of the ability for to drop price enough to kind of re-accelerate certain elements of growth and on the casualty front.

Michael Kehoe

I would.

Brian Haney

Say keep in mind that the margins on some of our highest margin business is extraordinary. When we, when you lower rates, in certain select areas, the effect is not immediate on the profitabilities and the growth. It takes a little while for it to, so I don't think where we've hit the point where.
We haven't exhausted our ability to, pull that lever, let's put it that way.

Michael Kehoe

And in terms of the market, Mike, you got to remember how diverse it is, right? It doesn't move monolithically. Large accounts, small, some states versus others, cat exposed versus non-cat exposed.
Clean accounts versus accounts with lost problems, the market's all over the place, but I, we, we're, we feel very comfortable with the guidance around 10 to 20% growth.
Okay.
Thank you very.

Bryan Petrucelli

Much.

Operator

Bill Carcache, Wolfe Research.

Bill Carcache

Hi, good morning, Mike. Following up on your growth comments, after seeing Kinsale grow at roughly 40% clip since 2019 and hearing you talk about it seemed like that entire timeframe that that growth wasn't sustainable. We've indeed now seeing your growth rate decelerate much more sharply. Is this sort of low 10s growth rate something that you think is now at a level that you would view as sustainable going forward from here? I understand you don't provide specific growth guidance, but I think your investors would really appreciate just hearing your thoughts, particularly those who weren't able to attend the investor day, on whether you see further deceleration from here versus the idea that at some point growth should plateau and how close are we to that point. And sort of with that as a backdrop, then could you also frame whatever that top line view is as you move down the P&L, is it reasonable for your investors to expect that the business model is capable of generating mid to high 10s EPS growth sustainably through the cycle?

Michael Kehoe

Yeah, I think that 10 to 20% growth is a conservative and good faith estimate as to where we go from here.
I think if you look back over 5 years when we were growing, at a 40% clip that was driven in large part by our business model.
We're the low-cost operator. We've got the best customer service in the industry, bar none.
I think we've got the broadest risk appetite that we offer our brokers.
We've got a handle on technology that I'm not familiar with any company that's, in a similar position that we are, in terms of low cost, but also, data and analytics. So we're very confident in what we're doing, will allow us to continue to grow at 10 to 20% clip.
The 40% growth was driven in part by a level of dislocation around the industry, and some of that's abated. We've seen billions and billions of dollars of new capital coming into the industry and so it's, things are more competitive now than they were, but we're bullish.

Bill Carcache

Thanks, Mike. And just to be crystal clear, your 10 to 20% growth is in reference to top line.

Michael Kehoe

Correct.

Bill Carcache

Because you also in your opening comments made some com comments around expecting to make continued investments that are going to improve the efficiency ratio. And so we should see, the rate of revenue growth exceed expense growth with positive operating leverage, you're doing buybacks. So the rate of earnings growth, would certainly be much stronger than that.

Michael Kehoe

I think it would be, yes, because the productivity gains.
Brian talked about, our new money and the investment portfolios being invested at higher rates than the current book yield of the portfolio.
Yeah, absolutely.

Bill Carcache

Okay, thank you. That's very helpful. And separately, if I may, for Brian Petrocelli and Brian Heeny on Capitol and buybacks.
I think investors appreciate that Kal operates a highly capital accretive business model that's capable of supporting faster growth environments, but it seems like when growth slows, your buyback capacity increases. So, I think following up on that thought, how much capital does Kinsale need to operate the businesses if growth written premium growth, gross written premium growth remains their current levels. Is the 23,000 sort of shares that you repurchase this quarter a reasonable run rate for investors to expect like sort of steady state, and then you would be.
Adding, additional buyback on top of that. If you want to be opportunistic, maybe if you could just frame how to think about those dynamics.
Thank you.

Michael Kehoe

Yeah, Bill, this is Mike. If you look at our our current buyback strategy, it, it's similar to our dividend strategy in that it's very modest.
And as Brian said in his comments at the beginning of the call, we expect to make modest buybacks each quarter. I think the 4th quarter is a good indicator of what we mean by that.
And then, hey, we're always prepared to move opportunistically if something arises where that makes sense.
But the dividend that we have is very modest. It's grown incrementally over the years.
I think the share buybacks is also kind of a modest capital allocation strategy and there's, the the capital model that we use to manage the business has a fair degree of complexity to it that I don't think it would be prudent to get into that on the poll, but in general, we're going to always make sure we have enough capital to maintain our rating and satisfy the regulators, but we don't want to have a super abundance of capital beyond what's required for that.
And so we think of the dividend and the buybacks as a way to address excess capital over the years.

Bill Carcache

Thank you. I appreciate you taking my questions.

Operator

Mark Hughes, Truist Securities.

Mark Hughes

Thank you. Anything on, January results, given that we're midway through February, anything in January that should call out?

Michael Kehoe

Well, I don't think we want to comment on January, but Mark, we've reiterated our confidence in the 2010 to 20% growth, and we've talked about the cat loss on the wildfires in Los Angeles. So that's probably.
Where we want to go at this point.

Mark Hughes

The expense ratio was a little bit higher this quarter, Brian Petroselli, anything unusual in that?

Bryan Petrucelli

As I commented, in my notes, it's largely driven by an increase in variable compensation but as we've talked in the past, that ratio is going to jump around quarter to quarter. So as you're sort of trying to model things out, I think looking at that 12 month ratio is probably what you should be, that's where I'm going to direct you.

Mark Hughes

Yeah, how about the cash flow in a Environment where say you're in the 10 to 20 range, if you were to parallel, kind of the low double digit quarter, how does cash from operations look that's been.
Obviously quite strong, that's been helping to support your The investment income, what does it look like, in a more modest growth environment? Does that flatten out, does it go down? How do we think about that?

Michael Kehoe

Pretty steady, it should grow with the premium, I think.

Mark Hughes

Very good, and then, you talked about leaning into personal lines, I know it's pretty small, but what could that mean for the top line if you do lean into the personal lines?

Brian Haney

Yeah, this is Brian Haney. I mean, if you look at it, the homeowner space is larger by itself than the ENS space in the US, and an increasing percentage of it, even though it's small, is moving into the ENS space.
So I think there's a huge opportunity for it, especially given. Like things like highways in California, it's like it's a very concentrated market that's just suffered a giant loss among a small number of players. So I think there's an opportunity there. I think there's an opportunity to expand what we do in the manufacturing housing space. I think there's an opportunity to expand into sort of adjacent. Type of businesses like stick built homes or you know non-manufactured housing homes all again, these are hard to place, catastrophe exposed, high margin business, but there's just a lot of it, and right now I think there's a, it's probably one of the harder areas in the overall PMC industry.

Michael Kehoe

Yeah, and it'll be kind of a gradual expansion over time. So I think it was like 2% of our book last year, but we're optimistic that will continue to grow quite a bit in the years ahead.
Thank you.

Operator

Andrew Andersen, Jefferies.

Andrew Andersen

Hey, good morning. Just thinking about the California loss, maybe a little bit bigger than I would have thought just given exposures in the state as of year end 23. Could you maybe talk about maybe the size of the gross loss there, where the losses are coming from, and kind of how growth has trended over the last year and maybe how you see it in the 25 for California specifically?

Michael Kehoe

The gross was about 45 and the net pre-tax 20.
It's a mix of commercial, inland marine, personal lines.
I can't really speak to the specific growth rate in California or that area, but Andrew, I would look at it this way, we've always written cat business because the margins are pretty compelling, and we've always written it with some degree of conservatism around risk management and Making sure that we control for the volatility, whether it's wildfire or coastal wind or what have you. And so I think actually this is a result that's Kind of right in the strike zone for us. It's a very manageable loss on business that throws off, pretty attractive margins.
In general.

Andrew Andersen

Thank you. And then on the the 17% submission growth.
Kind of the slowest in a in a little bit here, but as we turn to 25 and maybe you could just talk about the mix within that 17 if it's more casualty going forward, but I'd also be interested to hear if you're perhaps thinking about, kind of increasing your your quote to submission ratio or your bound policy to submission ratio to be more competitive and to a certain degree.

Brian Haney

We are definitely seeing a higher quote to submit ratio. It's one of the one of the upsides of lower growth is, it makes it easier for us to hit our customer service targets, including our ratio standards. So, yeah, we are quoting more and we are buying more, and then keep in mind that 17%, that number does jump around.
Yeah, is it?

Andrew Andersen

Is it starting to be a bit more casualty rather than property compared to maybe the last 12 to 18 months?

Michael Kehoe

Yeah, I mean it.

Brian Haney

Depends on what I mean, without getting too much into the weeds, it depends on what specific product you're talking about. We are seeing a lot more personal insurance submissions. We're seeing maybe fewer of the shared and layered submissions, but we're still seeing more inland re submissions. We're, it varies across the book.

Michael Kehoe

Yeah, and just, I think Brian, you mean we're seeing a lower growth rate in the Sheridanla, but it's still growing.

Scott Heleniak

Right.

Operator

Scott Heleniak, RBC Capital Markets.

Michael Kehoe

I think we lost Scott. Scott.
Yeah.

Scott Heleniak

Yeah. Good morning. Yeah, just wondering if you could comment on the Q4, the core action year loss ratio there. You saw there's improvement year over year. Anything, worth calling out, the tick down year over year. I know you kind of complimented before as it sort of improves your end if if lost trends come in better than expected, but anything notable to call out there?

Michael Kehoe

Scott, I would characterize it as, general success across the portfolio, but the impact on that quarter was probably a little bit driven by, some pretty exceptional results in the property area, that's shorter tail business, so you tend to see those positive results more quickly.

Scott Heleniak

Okay, that makes sense. And then I wonder if you could expand on you, referenced the agribusiness, the new product line there. If you can expand on the Kind of the exposure and geography you might, be, pla planning to go to there. And then also any other new products that, you want to call out for 2025. I know there was a lot in the previous two years, but anything else to call out there too.

Michael Kehoe

I'll answer that last question.

Brian Haney

First. Most of the new products we're thinking about for 2025 aren't nearly, as significant as let's say the personal insurance push we're making in the last few years or the agribusiness. The agribusiness would be virtually everywhere in the United States. Agricultural, the agricultural economy is basically present in every state, and it's going to be a mix of casualty and property exposures and then some sort of, unique exposures relative to farming and ranch.
Yeah, so I wouldn't expect any like dramatic new product in 2025, just gradual incremental, moving into adjacent lines.
Very gradually and slowly so that we, don't take excessive risk.

Scott Heleniak

Got it. That makes sense. Just the last one too on the, moving up the equity exposure, which you expect to take the 10, 10% and eventually 12%. Is that a similar strategy with using the basically stock ETFs? Is that the way you're going to do that, just upping your exposure to the existing investments you have in equities or anything different there?

Michael Kehoe

Yes, Scott, this is Mike. We have a portfolio that we manage internally.
It's kind of a value oriented large cap, mostly dividend paying, kind of a buy and hold strategy there, and then we've got the two ETFs, with the passive strategy, so it's a.

Scott Heleniak

Yeah, a little bit both, okay.

Operator

Michael Phillips, Oppenheimer.

Michael Phillips

Thanks. Good morning. I'm curious if you provide any updated thoughts on what you're seeing in your GL book Lost Trends, and then, I mean, I think your commercial umbrella and Aiss book isn't that small relative to your overall book. So maybe if you could even go deeper and say what the trends you're seeing in the umbrella piece as well.

Michael Kehoe

I don't think we've got a lot of specifics, there's a lot of industry data out there. I think our lost trends would probably conform to what you're hearing.
I didn't bring that information.

Brian Haney

I would say just on an absolute basis that the margins in our umbrella book and our GL book are are really strong and unlike.
I I saw an interesting chart the other day. Our development has been consistently better than the industry's reserve development, so I think we are doing a better job, staying on top of those, lost trends in the in the reserving process. I do think it's going to be a maybe a problem for the industry going forward.

Michael Kehoe

Okay, yeah, thanks.

Michael Phillips

Brian. And maybe one more in California, I mean, given the news that we're kind of hearing about the eating side of the losses there, any chance you take your 25 and split it, eating versus and thealates.

Michael Kehoe

It's 101 and 0, it's all palsates.

Michael Phillips

Okay, perfect.
Thank you very much.

Operator

Pablo Singzon, JPMorgan.

Pablo Singzon

Hi, good morning. As you're lowering prices and essential for growth, is the trade-off confined with a specific line or are you willing to cross subsidize across lines, right, like using more profitable lines to support less profitable lines, or? Maybe you're looking at the dollar profitability more holistically on a level basis instead, so just some perspective on how you're carrying out the strategy would be helpful.

Michael Kehoe

Well.

Brian Haney

I would say we don't cross subsidize anything because we don't have loss leaders. Every division, every product is supposed, it has to be able to hit our profitability targets. It is a calculation we are kind of doing at the individual division level. Obviously some divisions, all of our divisions are doing well. Some of our divisions are doing.
Remarkably well from a margin perspective, and those are the ones where we're looking at sharpening our pencil and getting a little more aggressive in places.

Pablo Singzon

Gotcha. That makes sense. And then, second question, I was hoping you could comment prior to your development this quarter, so, favorable overall, but we'll be curious about the breakdown of fa and negatives, are you still adding to construction defect research from over the years and where are you getting the releases?

Michael Kehoe

Well, we talked about property, as a short tail line of business. You see those results more quickly.
And we, we've pushed our construction related, loss ratios, they're well into the 80% range, and that's largely because if you go back to accident years, I forget where it starts, maybe 15 or 1,617, 1,819, we did see the impact of inflation in particular on those lines where the cost of repair, labor costs, etc. Jumped pretty dramatically in a couple of year period. So, we've raised rates dramatically.
Our coverage is a little bit tighter than it used to be.
Made a lot of adjustments on the underwriting that gives us confidence that.
The results for the, say 20 to 24 are going to be quite a bit better, but we don't know definitively. It's a long tail line and so we just like we do across the whole book, we set aside what we think are very conservative loss reserves and if there's good news in the future, that'll be great. If not, we're prepared, with our current reserves to absorb that.

Pablo Singzon

Gotcha. Thanks, Mike. And then speaking just last one, as a follow up on the question about the attrition loss ratio, would it be reasonable to assume flat to higher attritial loss ratios just, given the more competitive pricing environment and your strategy of trading off pricing and growth going forward?
Thank you.

Michael Kehoe

Well, it's a broad line with a lot of different component pieces, but, in general, as Brian, I think said earlier, rates are flat for the quarter, so, I would make some assumptions based on that.

Pablo Singzon

Thank you.

Operator

Andrew Kligerman, TD Securities.

Andrew Kligerman

Hey, good morning. Just a little nuance on some of the prior questions. I guess, Tacking on to the loss ratio question. I mean, you came in at an exceptional 73.4% combined. I mean, I would, any other company, I would have thought it was their loss ratio, not their combined, but If, and if I look at a charts.
And I go back 10 years.
I see that you've kind of, maybe closer to 10 years ago, you were in the low 70s, 1 year you were at 60, maybe in the middle years you were in the low to low to lower mid 80s. So, given that the environment is getting a lot more competitive in various areas, Any sense of the the cadence of what could happen going forward, could we see kind of a gradual drift into the low 80s over the next few years?

Michael Kehoe

I think that's certainly possible.
We want to maximize.
Wealth building for our stockholders, and I think you do that by balancing profitability and growth, and I think that's what Brian's trying to address earlier with his comments around, fine tuning our pricing on certain ultra high margin lines.
But in general I think what we're going to maintain is best in class profitability.
Very strong growth rates and we expect can sell stock price to appreciate in value, in the years ahead.

Andrew Kligerman

Okay, and maybe on the verticals, could you remind me of how many Segments that you have right now, similar to the ag segments, and I know you mentioned in an earlier question that you know this year's going to be big in personal lines and ag for growth. Maybe thinking out to 26 or 27, how many of these verticals would you like to add each year and then and again, how many do you have right now?

Michael Kehoe

Yeah, look, we have 26 now. I would look at these verticals as a judgmental way to divide and organize our underwriting teams around industry segments and coverage, right? So we want experts at the at the desk level and so you have to have some degree of focus.
To really be an expert at the underwriting and understanding the businesses we're insuring and all the characteristics of this business that drive loss exposure and trends on the legal side and who are our competitors and how do they segment in price risk.
So there's no magic number, it certainly may incrementally grow over time. And then just a quick correction on the The new business lines. I think Brian said earlier, we don't expect extraordinary growth from our new business. We expand the product line over and over again over the years and we get incremental growth, it's part of our our strategy to roll out new products in a methodical fashion.
To, really, increase the probability that we're getting things, right.

Andrew Kligerman

I see. And when you say When you say expanding incrementally, that would mean within a vertical, maybe adding a new A new product line.

Michael Kehoe

Yeah, incremental expansion of the product, but if we roll out a new underwriting division, we might write, several million dollars. We're not going to go corner the market the first, year we're in business. And that's been a good strategy for us over the 6, this is our 16th year in business, so it's, yeah, I think it's worked well for us over time.

Andrew Kligerman

Super helpful. Thanks a lot.

Operator

Michael Zaremski, BMO Capital Markets.

Michael Zaremski

Okay, great. Just a couple follow-ups. In terms of, employee, growth, I know that 10K is not out, but, would you just say kind of high level as the company gets larger, the employee employee growth rate has been decelerating a little bit or any color there?

Michael Kehoe

I think we've gotten incremental gains in productivity every year if you measure that by gross written premium per full-time employee.
I think it's gone up every year and you know with the Work we're doing in the technology area, we certainly would expect that to continue.

Michael Zaremski

Okay, got it. And lastly, I'm going back to kind of lost cost trend and reserves, tell me if I'm crazy, but given how robust your reserve releases have been, relative to the kind of the pricing stats you all give out, it kind of implies that your lost cost trend is.
Closer to to zero than to than to, the high single digits of lots of companies talk about on the casualty side. Any comments?

Michael Kehoe

Yeah, our lost trend assumptions would definitely not be zero.
It would be somewhere in the high single digits. There's some variability by line of business, but We're definitely conservative on estimating future losses.

Michael Zaremski

Okay, I TRY to, it's been a pretty steady reserve releases, so, pause you're being a little too conservative. Okay, thank you.
Alrighty.

Operator

Casey Alexander, Compass Point.

Casey Alexander

Hey, good morning. Most of my questions have been asked and answered, but I have a couple for you. First of all, when you talk about the wildfires with 45 million, of which 25 million is your end of it, is that top of limit without much slack to that number, or because the losses are kind of across personal and commercial property. As you adjudicate those losses, is there some opportunity to drive that 25 million number down some?

Michael Kehoe

Yeah, I mean, it's an estimate, Casey. I mean, we're working through quickly. I mean, property claims typically are resolved much more quickly than they are on the casualty side. So, but I think it's a good faith estimate and it's certainly possible it could move up or down, but I wouldn't expect it to be dramatically different.
Okay.

Casey Alexander

Thank you. Secondly, I'm just kind of curious and I'm not trying to irritate you because I know you guys don't like to be measured on a price to book basis. You don't think that's appropriate. But the fact of the matter is is that there's a lot of investors who look at the price to book value and it, and it just slows them down in terms of whether or not to invest in the company based upon the valuation. So I'm curious why the the the share repurchase program is sort of an on the run thing that That actually is dilutive to your book value when you could easily take some of that capital and better devote it to the dividend, which wouldn't have necessarily the same level of impact on your book value and would still be a positive way of returning capital to shareholders and thus leaving the share repurchase program for periods where there was really excess volatility in the market. I'm just curious.

Michael Kehoe

Yeah, so, number one, the share repurchase program is very modest, right? We bought $10 million worth of stock on a market cap of somewhere north of $10 billion. .
The second point I'd make is we respect the fact that a lot of people look at price to book. It's just that you have to remember, we are, we are a very capital efficient company.
So we have enough capital.
To operate our business and then we have some extra because there's some variability in our business and we have to be able to absorb that.
But we have competitors that have tremendous amounts of redundant capital beyond what they need to operate the business. So someone that has a very bloated capital base and can sale that has a very efficient capital base, and if you're comparing our respective price to book multiples, you're comparing apples and oranges.
Whereas if you look at forward earnings or last 12 months earnings, I think it's more of an apples to apples comparison.
And then the last point I make is we think our stock price is really driven by, expectations around future earnings.
And we think most investors don't value us on our assets or, assets minus liabilities or our book value.
So that's the rationale basically.
Thank you for taking my questions.
Okay, you bet.

Operator

We have no further questions. I'd like to turn the call back over to Michael Keyhill for closing remarks.

Michael Kehoe

Okay, well, we appreciate everybody's time this morning. We're optimistic about the future and look forward to talking again here in a couple of months. Have a great day.

Operator

This concludes today's conference call.
Thank you for your participation. You may now disconnect.