Good day, ladies and gentlemen, and welcome to the Q3 2025 Arch Capital Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session, and instructions will follow at that time. As a reminder, this conference call is being recorded. Before the company gets started with its update, management wants to first remind everyone that certain statements in yesterday's press release and discussed on this call may constitute forward-looking statements under the Federal Securities Laws. These statements are based upon management's current assessments and assumptions and are subject to a number of risks and uncertainties. Consequently, actual results may differ materially from those expressed or implied. For more information on the risks and other factors that may affect future performance, investors should review periodic reports that are filed by the company with the SEC from time to time, including our annual report on Form 10-K for the 2024 fiscal year. Additionally, certain statements contained in the call that are not based on historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The company intends the forward-looking statements in the call to be subject to the safe harbor created thereby. Management also will make reference to certain non-GAAP measures of financial performance. The reconciliation to GAAP for non-GAAP financial measures can be found in the company's current report on Form 8-K furnished to the SEC yesterday, which contains the company's earnings press release and is available on the company's website at www.archgroup.com and on the SEC website at www.sec.gov. I would like to introduce your host for today's conference, Mr. Nicolas Papadopoulo and Mr. Francois Morin. Sirs, you may begin. Good morning and welcome to Arch 's third quarter earnings call. We delivered a record result in the quarter with over $1 billion of after-tax operating income and over $1.3 billion of net income, both up 37% year- over- year. After-tax operating earnings per share of $2.77, another record, represented an 18.5% annualized operating return on average common equity. These results reinforce the strength of our diversified platform, which enables our underwriters to pursue opportunities and deploy capital across the enterprise. Meaningful contributions from all three segments, combined with solid investment returns, pushed year-to-date book value per share growth to 17.3%. Our quarterly consolidated combined ratio of 79.8% reflects excellent underwriting and low cat activity in the quarter. Big picture, our nine-month combined ratio of 83.6%, which includes the impact of California wildfires and severe convective storms, highlights the strong underwriting performance across our businesses. Now, some comments about market conditions. As you have heard on other calls, competition is generally increasing. As cycle managers, we lean into the strengths of our brand, including underwriting discipline and using risk-based pricing tools to generate profitable business. We deploy capital into businesses we believe will generate superior risk-adjusted returns. However, given relatively weaker market pricing and an attractive entry point for our stock, we repurchased $732 million of shares in the quarter. Critically, our strong balance sheet and strong capital-generating capabilities permit us to both invest in our business and return capital to investors. Our objective is clear throughout the cycle: to maximize returns for our shareholders over the long term. Importantly, I want to emphasize that we are actively looking to deploy as much capital as possible towards attractive underwriting opportunities. Our playbook remains consistent: allocate capital to attractive opportunities that meet our risk-adjusted target returns, pursue profitable growth while prioritizing renewals that meet our return thresholds, and take full advantage of our operating flexibility across insurance, reinsurance, and mortgage. Over time, this playbook has been key in enabling us to deliver consistently strong returns without regard to market cycles. I will now provide some color from our reporting segment, starting with our property and casualty insurance group. Underwriting income for the quarter was $129 million, up 8% year- over- year, on nearly $2 billion of net premium return. Our combined ratio was 93.4%, with a current excellent share ex-cap combined ratio of 91.3%, reflecting the strong underlying margins of our insurance portfolio. A distinguishing strength of our insurance segment is its breadth across specialty lines, areas where our team applies deep knowledge and experience to drive better risk selection. Successfully navigating a transitioning market demands that our underwriters employ the capabilities and experience they have developed to leverage our differentiated offerings and market leadership position as we look to drive profitable returns. When compared to the third quarter last year, we grew net return premium in North America over liability occurrence by 17%, supported by growth in the middle market and double-digit rate increase in E&S casualty. Net return premium in our North America property and short-tail book increased 15%. Growth in middle market and leading property more than offset declines in excess and surplus property. International premium volume was essentially flat. A strategic element of our insurance growth is our middle market business in North America, which was significantly enhanced through the mid-corp and entertainment acquisition last year. As discussed previously, the acquired business provides a significant platform from which we intend to build further scale in the middle market sectors. Importantly, it is already driving growth and yielding tangible returns. At the outset, we set three integration priorities for the acquired business: rollover the portfolio, remediate less attractive areas, and separate from legacy systems. We have completed the portfolio rollover. Remediation and separation are on target. Even though there is still work to do, we remain excited about this opportunity, which has been well received by our distribution partners. Next to reinsurance, which delivered another strong quarter with a record of $482 million of underwriting income, a 76.1% combined ratio was a significant improvement over last year's scale-heavy third quarter and illustrates our ability to generate attractive underwriting returns. Net premium returns were $1.7 billion, down roughly 11% year- over- year, reflecting current pricing conditions in short-tail and property cat lines and increased retention by cedents. The diversity of our reinsurance platform means we aren't overly concentrated in any one line. For example, property cat, which has been a hot topic of recent industry conferences, represents only 14% of reinsurance total net written premium for the trailing 12 months ended September 30th. Our diversified reinsurance platform, supported by a strong partnership with our broker and cedent company across multiple lines and geographies, further enhances our ability to navigate a competitive environment. We continue to like our prospects in most lines of business, and with improving conditions in casualty lines, our agility and ability to create opportunities is an advantage for us in this market. Moving to mortgage, which continues to operate exceptionally well, generating $260 million of underwriting income for the quarter. The segment remains on pace to deliver approximately $1 billion of underwriting income for the year and is a steady diversifying contributor to Arch's earnings. While mortgage originations remain modest due to affordability challenges, our high-quality in-force portfolio continues to outperform expectations. We are well positioned to support first-time home buyers when the U.S. housing market eventually expands. The broader mortgage insurance market remains healthy, with disciplined underwriting and stable pricing. Now turning to investments, where strong earnings and cash flow grew investable assets to $46.7 billion this quarter, with net investment income of $408 million, a quarterly record for Arch. We continue to position the portfolio to remain conservative in the current environment, with an eye towards generating reliable and sustainable earnings and cash flows for the group. To conclude my opening remarks, I want to emphasize that we manage Arch with a long-term lens. That was true in the past, it is true today, and it will be true tomorrow. Market cycles span years, not quarters, and in a transitioning environment, our focus remains on producing superior returns and profitable growth. Our ability to remain successful is rooted in our differentiated customer experience, superior risk-based pricing, and the creativity of our underwriting teams, which are empowered and incentivized to generate profitable business aligned with shareholder value. Today, we are well positioned to outperform in an increasingly competitive market. Our strong capital position gives us the flexibility to invest in the most attractive risk-adjusted opportunities, whether in the business or by returning capital to shareholders. This transitioning market is a moment to lean into our strengths with confidence and clarity. I now turn the call over to Francois before returning to answer your questions. Thank you, Nicolas, and good morning to all. Last night, we reported our third quarter results with after-tax operating income of $2.77 per share and an annualized net income return on average common equity of 23.8%. Book value per share grew by 5.3% in the quarter. Similar to last quarter, our three business segments delivered excellent underlying results with an overall ex-cap accident year combined ratio of 80.5%, down 40 basis points from last quarter. Our underwriting income included $103 million of favorable prior year development on a pre-tax basis in the third quarter, or 2.4 points on the overall combined ratio. We recognize favorable development across all three of our segments and in many of our lines of business. The most significant improvements were, once again, seen in our short-tail lines in our P&C segments and in mortgage due to strong cure activity. Current year catastrophe losses were low at $72 million net of reinsurance and reinstatement premiums in what is typically our most active quarter for catastrophes. The insurance segment's net premiums written grew by 7.3% compared to the same quarter one year ago, mostly due to the contribution of the mid-corp and entertainment unit for a full three months this quarter compared to only two months from the same quarter one year ago. The ex-cap accident year loss ratio improved by 10 basis points to 57.5% compared to the same quarter one year ago, and the 220 basis point increase in the acquisition expense ratio is primarily due to the benefit we observed in the third quarter of 2024 from the write-off of deferred acquisition costs for the acquired business at closing under purchase GAAP. Profit commissions paid for prior accident years also explain some of the increase from the same quarter one year ago by approximately 40 basis points. The reinsurance segment produced its best quarter ever in terms of pre-tax underwriting income at $482 million, a direct reflection of the strong underlying profitability of the business written over the last few quarters and the absence of significant catastrophe activity in the quarter. Overall, net written premium was down by approximately 10.7% from the same quarter one year ago. Of note, approximately 75% of the overall reduction is the result of two large transactions from the third quarter in 2024 in our specialty line of business that did not renew this quarter. The absence of reinstatement premiums also negatively impacted our top line this quarter. Our ex-cat accident year combined ratio remains very strong at 76.8%, reflecting the robust level of underwriting margins in our book of business. Once again, our mortgage segment delivered another very strong quarter with underwriting income of $260 million. The improvement from last quarter was primarily due to a lower level of ceded premiums as a result of the tender offers we executed in the second quarter for two Bellemeade Re securities. There was also a slight benefit due to a higher level of cancellations on CRT transactions. The delinquency rate of our USMI business increased to 2.04%, in line with our expectations due to seasonality in the business. On the investment front, we earned a combined $542 million from net investment income and income from funds accounted using the equity method, or $1.44 per share pre-tax. Net investment income remains an important source of income for us, and with the help of strong positive cash flow from operations, $2.2 billion in the quarter, it should continue to grow in line with the size of our investment portfolio. The allocation of our portfolio remains neutral relative to our targeted benchmark. Income from operating affiliates was strong at $62 million, due especially to a very good quarter at Somers Re. Our operating effective tax rate on a year-to-date basis stands at 14.7% and reflects the mix of income by tax jurisdiction. It is slightly below the 16%- 18% previously guided range, mostly due to a 1.7% benefit from discrete items. As of October 1, our peak zone natural cat probable maximum loss for a single event, one in 200-year return level on a net basis remains flat at $1.9 billion and now stands at 8.4% of tangible shareholders' equity. Our PML remains well below our internal limits. On the capital management front, we repurchased $732 million of our shares in the quarter and added $250 million to this number so far in October. On a year-to-date basis, we have repurchased 15.1 million shares, representing 4% of the outstanding number of common shares at the start of the year. As Nicolas mentioned, our balance sheet is stronger than it's ever been, and it remains a significant asset for us as we focus on executing our playbook and leveraging the value of the Arch brand as we move forward in this dynamic market. With these introductory comments, we are now prepared to take your questions. Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We'll pause for just a moment to allow everybody an opportunity to signal for questions. Your first question will be from Elyse Greenspan at Wells Fargo. Please go ahead. Hi, thanks. Good morning. My first question is just on capital. The level of buyback went up in the quarter. I guess my question is maybe two-pronged. How do we think about the level of buybacks going forward, just given the strong earnings this year? I know last year you guys had gone the route of a pretty substantial special dividend. Is this year the route more of buyback versus a special in terms of capital return? Yeah, the last one, I think it's, you know, for us, we think of those as two options, but most likely not going to do both at the same time. In this current environment where, yes, we certainly see our earnings profile being very strong and we think there's, you know, as we've seen, right, limited opportunities for growth, for us to grow aggressively in the business. Capital return to shareholders will remain a focus. Given the stock price, I think, you know, share buybacks will be our preferred method going forward, at least for the short term. We'll see how things play out moving forward. That's obviously something we talk with our board, you know, on a regular basis. I'd say that's kind of, you know, where we're at. Again, you know, balance sheet remains very strong. Is there room for us to do more buybacks as we move forward? I think the answer is definitely yes, and, you know, something we'll keep evaluating as we move forward. My second question is just on the insurance premium growth. We've annualized the mid-corp deal, but there is going to be some impact from non-renewals there. Obviously, the overall market, which is softening in spots. How do we think, as you guys think about pricing, the combination of the non-renewals on mid-corp, how do you guys see the premium growth outlook for your insurance book from here? Yes, good morning. On the insurance side, I think we are now, we're still very much bullish about the business. I think we like the market we trade in and we would like to grow. You know, we talk about profitable growth. That's what we're really focusing on. You have to divide the market in three broad categories. First one being areas where we still see some rate increase, you know, like casualty would be the main one. The middle market, you know, business where we think we have the rate increase and I think we have the propensity to grow. You have the second segment, which is the one that I've witnessed headwinds in the past, which is mostly professional lines, whether it's GNO or cyber. The good news there, I think the rate decrease has really moderated on the GNO, pretty flat. On cyber, there are signs that they are moderating. That should be less of a headwind going forward. Third, it's really the property, whether it's the large account property and the E&S property. The good news for us is that we don't write much of the shared and layer property business. We have a relatively small footprint on the E&S side, which is really under a lot of pressure today. I think overall, if I look at the outlook for us and our positioning in the London market as well, if I look at the outlook, I would expect us to have the ability on the insurance to grow better than the market we play in. That's helpful. Just one last one. There's a hurricane out there right now with the potential to impact the Caribbean. I don't think there is a lot of insurance or even reinsurance exposure there, but do you guys just have some high-level thoughts there just on potential exposure? I think it's just too early to tell. I think it for sure will be, it's going to be a, it looks like a big event potentially for Jamaica. If it's big enough to have repercussions, that could affect the Caribbean overall. Too early to tell. Okay, thank you. Yeah, I could be just quickly. Obviously, depending where it hits, like some of the resorts might be that the insured values that might be more, you know, that we might participate on just, you know, not knowing at this point where, again, where things may land. I think that's the, in terms of where the, yeah, where the exposures are and what could be impacted, that would be the focus area, I would say. Thank you. You're welcome. Next question will be from Andrew Kligerman at TD Cowen. Please go ahead. Good morning. Maybe starting with, you just touched on growth in insurance with Elyse, maybe shifting over to reinsurance. You kind of kicked off, I remember in the first quarter, you thought that, I think, you did adjusted net written premium growth of 6% or 7%. You kind of repeated that in reinsurance in the second quarter. This quarter, you talked about the two deals and the reinstatement premium is kind of creating a bit of noise. The part A of it is, what would the normalized growth have been in the absence of those items? The part B is, how are you thinking about growth going forward in that segment? I'll take the first part. Maybe Nicolas can share in a second. The normalized growth absent all of these kind of one-offs, or again, they happen, right? We've talked about it in the past. It's, you know, reinsurance can be lumpy. There's deals that happen. They don't happen. The timing of it is not always predictable. The fact that, you know, with a little bit of the headwinds that we're seeing, again, coming from a very high bar on the property, property cat, 7/1 renewals, I'd say our growth in the quarter might have been around, like, call it, you know, a decrease of 3%- 4%, not the 10% that was reported in the quarter. Yeah, thank you, Francois. On the outlook for growth on the reinsurance side, I think of reinsurance, it's pretty much the same outlook as insurance. I think you have a rate pressure on the short-tail lines, but I think you're seeing a rate increase in this location on the casualty lines that could provide opportunity. I would say a similar picture. A big headwind is a lot of our seeding companies, like the business we do. We like the insurance business. After a few years, there's less fear in the marketplace. People feel better about their balance sheet. What we're seeing is companies retaining more, which creates a significant headwind for the reinsurance group. By doing so, they either retain the business or very often move more to an excess of loss position that presents additional opportunities for us. I would say that the margin on the excess of loss is usually better than the margin on the quota share. I think we may see a different makeup of the margin going forward. Thank you for that. Maybe shifting back to insurance. As As a specialty writer, especially with pressure in E&S property these days, just more from the industry perspective, you touched on your view of how Arch is going to do, but maybe again a little bit. How do you see E&S premium for the industry playing out over the next few years? Not only have we seen such tremendous growth over the last few years, but is it possible that E&S premium as an industry starts to decline over the next few years? Outlook and then just Arch in E&S over the near intermediate term as well. I think the outlook of the industry is a tale of two stories. On the casualty side, because of what's happening in the market and because of the issues people are having with the prior years, my view is that the trend of more of the business moving to the excess and surplus side, where you have freedom of rate and forms and where you can add exclusion that takes a much longer time to be able to do on the admitted side, will continue. On the shorter line, we could see some of the shared and layer business and cat exposed business going back to the admitted market as they've done historically. It is hard to predict, but I think the fundamental shift, which is being driven by casualty, I expect to continue. I see. How do you see yourself? Do you see gaining share on the short tail and the casualty respectively? I mean, the short tail would be a challenge based on what we see in terms of the pricing. I think we are more optimistic on the casualty side where we've been underweight in the difficult years. I think our last pick has been holding pretty well. That gives us confidence in how we price the business forward. I think that as rates continue to improve, that gives us an opportunity certainly to do more at a time, maybe when our competitors are still kind of caught up into looking at the right things they did in the earlier years. Thank you for the insights. You're welcome. Next question will be from Josh Shanker at Bank of America. Please go ahead, Josh. Yeah, I don't want to pigeonhole you too much, but obviously did a lot of buybacks in 3Q. Some companies don't do buybacks in 3Q because they're worried about the outcome of the hurricane season. Trying to gauge your appetite for 4Q and maybe 1Q, when did you start buying back and how much were you buying the whole quarter or were you able to do $732 million within about a month ending up a quarter? Yeah, I mean, it was pretty consistent throughout the quarter. I think there was, you know, we've gotten a little bit more in September. That's kind of, as I mentioned, I think we've been active in October as well. I think, again, it's, you know, I think I touched on it on the last call. No question that, you know, some years ago we would have said we would not buy during the hurricane season. I think Arch is different today than it was back then. I think Arch is much more diversified, much stronger, less exposed on a percentage of equity from a massive or a cap, you know, PML even at the 1 in 250 or below. For all these reasons, we felt, we do feel and felt a lot more comfortable buying back during the wind season. I think, as I said earlier, I think we're going to keep pursuing that opportunity as we move forward. You're not worried. In the past, you've said part of the reason to do a special dividend was because you just don't think you can return as much capital as you desire to through the buyback due to the limitations. As you look out into the end of this quarter and beyond, do you think you can satisfy every bit of capital return you need through repurchases? I think we look at it daily. I certainly think we can do more capital return. We don't set a target for ourselves, right? I think it's an ongoing process. There's a lot of liquidity in the stock right now, and we're able to buy back stock. We think what we perceive to be a very attractive price, and we'll do as much as we can, how much we think is right. Then we'll see where we're at. All right, thank you very much. You're welcome. Next question will be from Tracy Benguigui at Wolfe Research. Please go ahead, Tracy. Thank you. Good morning. This is a bit belated, but it's been a while since I've been on your call. Congrats on your S&P upgrade back in June. Since capital is so topical, my question is, while it's great that you have a AA- rating, it's a new category. You now have to hold AAA capital. Back when you were rated A+, you only had to hold AA capital. I realize a lot of that was just model methodology driven. My question is, how important is it to you to stay in this new rating category when you're thinking about your ability to deploy capital? Is it critical? It's not, but it's certainly an advantage. We've seen the benefits of that already in some places, particularly in Europe. No question that the new higher rating has been well received and we're able to benefit from that. You're right, it comes at a certain cost. I'd say, though, that the S&P capital model is only one of the things we look at. We have our own internal view of capital. There are other rating agencies that we look at as well. All in, I think our capital position remains very strong. It was always strong. We try to optimize within all those constraints from all the rating agencies and regulators that look at us. The AAA level of capital that you mentioned is really not something that is new to us because we were already at that level. It wasn't an additional burden or initial step we had to meet. Yeah, I think, you know, we don't only manage one point. I mean, usually, we look at AA, AAA. You know, for a while, I think we were a little bit in the penalty box because of the MI. I think now it's more, I don't think it changed completely our capital structure. Also, I think it's been helpful on some of the MI, CRT, and SRT where the buyers are extremely sensitive to the rating of those layers. They actually pay a differentiated price for better ratings. As I said, I think in Europe, as we lean to, especially on the reinsurance side, but also on the insurance side, our strength is really casualty professional lines. As we lean into those markets, I think having a AA- rating is an advantage. Okay. I mean, do you view it just opportunistically, or could you see a scenario where you could reduce capital and live with them back to the A+ rating? It's obviously something, I mean, it's a trade-off we all constantly look at, right? I mean, how much capital do we need to hold on the margin to get the incremental rating? Right now, we already have the capital. We're not, you know, we're in a very strong capital position. If, down the road, conditions change, the question you ask is something that we've asked ourselves many times in the past. How much capital do we, you know, is it really worth it to us to hold that incremental level of capital? Right now, given our capital position, and again, given the strength of our earnings, the earnings profile where we generate internally the capital on a regular basis, I think we're in a very, very good position. Okay. My next question is, you said you liked insurance and you're bullish on business, and you mentioned casualty rate increases. Casualty can mean a lot of things. Once I strip out some of the casualty lines, like you mentioned professional lines, what is really left, what you're left with in terms of attractive pricing is GL, commercial auto, and excess liability, which includes auto. I'm wondering where you're seeing the opportunities. Is it more auto-oriented? If you could just let me know the different casualty lines that are attractive? I think one of the opportunities on the E&S casualty side, which would be excess, you know, excess liability, would include some auto, but usually, you know, we don't focus on the auto on the E&S side. We have other franchise, like sensitive business, like national accounts or constructions, which are casualty-led lines with heavy components of workers' comp, general liability, and a lesser amount of auto. Those are the places where we think we have the ability to grow. Thank you. You're welcome. Next question will be from Ryan Tunis at Cantor. Please go ahead, Ryan. Hey, thanks. Good morning, good afternoon. I just wanted to go back. I thought it was an interesting comment that on the reinsurance side, you're seeing cedents proactively retain more. I guess I'm curious, when I look at like the facultative property decline of 17% this quarter, how much of that is, I don't know, you guys proactively walking away or a decline in exposure as opposed to rate? I was thinking it was kind of more rate-driven, but that comment made me think it might be more volume-based. No, I don't think we are cutting back. I think at this stage, we are on the other property, which, you know, you should clarify other property line of business. The main factors there is a couple of our clients on the E&S side of the business retaining more of the business at this stage. That's really, we would like to do more. Also, let's not forget the rates are also going down. Some of our cedents are also revising some of their ceded premium to the downside. Those are the two components: their ability to want to retain more of the business and also they're reforecasting their growth downwards, which impacts our insurance volume. To follow up after that, I think Ryan, I think it's great just to confirm, I mean, it's no question that the rate environment is down in property. There's also a drop in exposure, but just to be clear, that drop in exposure is typically not our decision, right? It's the cedent's decision. There are some situations where they decide to keep it net or they use a different structure, but we still like the product. We still like the line. I think most of what we do, we like a lot. Any reduction in exposure that you see that we experience is generally at this time more because the cedents choose to do something different, not because we decide to walk away. Got it. Just to follow up, you guys talking about the transitioning market. I think a lot of times we just kind of focus on pricing, but I'm curious if, you know, what type of lines are, and it might be in primary because there's business going back to admitted and just some of the more bad stuff stays E&S or I get, you know, facultative. I guess it could be a cedent just choosing to, I guess, just continue to cede the stuff where they feel like there's an arbitrage. What, like, are there pockets you point out that are kind of particularly challenging to underwrite in this type of market where you really got to kind of cross your Ts and dot your Is? I think it's a competitive market, you know, Ryan. I would say a lot of the market today, you get a lot of anti-selections. We develop a lot of data analytics tools to really segment our portfolios and provide underwriters some really granular information that, you know, which price for which risk, which limit for which risk. I think underwriting the market, we are bullish because we have those tools. I think if you don't have the tools, I would be a lot less bullish about our ability to write profitable business going forward. Thank you. Did you have further questions, Ryan? I'm good. Thanks, guys. Appreciate it. Next question will be from Mike Zaremski at BMO. Please go ahead, Mike. Okay, great. Thanks. Pivoting to the mortgage side of the business, I feel like if we were to quiz most people and ask them what the historical, I don't know, five, six, seven-year loss ratio was, most people wouldn't guess it was zero. Obviously, there were unique circumstances in the past five-ish years. Just curious, and we know it's a feature family business, but curious if your views on a normalized loss ratio is different than what it was in the past if we think about the current cycle and the next cycle coming. Not knowing what the next cycle will look like, I think we'd be speculating. I think we have talked about a normalized loss ratio in the 20% range across the cycle. I think what we have said, and we believe strongly, is that home prices are the key driver of what performance will look like for the mortgage book. So far, home prices have remained very strong. There have been, in some pockets, some home price declines in a few areas, but across the nation, across the U.S., you can see that home prices are remaining very strong. That, I think, explains in large part the outperformance of the mortgage business relative to what we would have thought over an extended period. Does that remain the same going forward? There are a lot of macro factors that will come into play on that. As long as, and we do have strong beliefs that, based on lack of inventory and kind of a lack of housing in the U.S., I think that will support home prices for the foreseeable future. On that basis, we'd like to think that the performance will remain strong. Now, does it inch up a little bit over time? Maybe a little because it feels like it's been really, really good for a long, long time. For the time being, we've said it, and we still are very, very, very bullish about the mortgage business because it's been truly a terrific business for us. Yeah, I understood. Go ahead. The underwriting will remain excellent. I think if you look at the FICO's distribution, I think they're getting better. That will drive better outcome. Got it. Moving to capital management, clearly, you signaled buybacks are high on the list. Maybe you can just kind of give us an update. Has anything changed quarter over quarter on maybe inorganic opportunities? Is U.S. small commercial still something that's on the retail small commercial still high up on the wish list? Thanks. Yeah, the wish list is long. I mean, we, you know, by the same token, we have a lot that we are working on and can work on. Middle market is obviously a big focus for us. We've talked about other areas that we'd like to grow in. As you know, these M&A opportunities, they don't happen that often. They take a while to materialize. We're not going to hold a ton of excess capital just on the potential that we might do an M&A transaction. I mean, our leverage ratio is maybe the lowest it's ever been. We've got a lot of flexibility. The balance sheet is strong. We got some excess capital. We got a lot of flexibility in our ability to execute on that, I think, is really good. If there's other things that we can get our hands on that would make us better, we'll be happy to do that. In the meantime, there's a lot that we already have that is, you know, we can generate good earnings on as well. Got it. Maybe just taking one last one in since you guys provide excellent market commentary. Nicolas, you provided a good view of kind of how to think about the E&S marketplace going forward. Do you all have a view on what has also been the kind of exponential growth of the MGA marketplace and kind of how it's been impacting Arch or maybe the industry? Do you view the MGA marketplace growth to continue to grow much faster than the rest of the market? Thanks. Interesting subject. I'm personally bearish on the, you know, the MGA. I think, you know, historically, you know, strong growth in the MGA, you know, except for a few exceptions, you know, didn't turn out to be good. I think the lack of incentive alignment, the delay in the information to the insurance carrier or the reinsurers, I'm not bullish on that model. I think it's been the flavor of the months in the last few years. I'm still a little bit questioning what the outcome is going to be. Thank you. Next question will be from David Motemaden at Evercore ISI. Please go ahead, David. Hey, thanks. Good morning. Just had a question. Obviously, still very good reserve releases. Just focusing in on insurance and reinsurance specifically, could you talk about the movement between long-tail and short-tail lines between those two? Any sort of things to point out on that front? I'd say nothing unusual. Very similar to prior quarters. There's a little bit of the adverse on casualty. I mean, not nothing that stands out. It's a couple of, you know, it could be one accident year within one business unit or one line of business. So small, small adverse on casualty, which I don't think is surprising, at least to us. When we look at the overall picture around kind of where, you know, how the reserves are performing, our quarterly actual versus expected, which is still showing favorable, meaning lower than expected, I think gives us a lot of comfort there. We're reacting to the data. In some places, there's no question, there's trends that are showing up that we're addressing. Big picture, the short-tail stuff did extremely well, as it has for quite some time. We'll keep evaluating it every quarter. Got it. Thanks. Thanks for that. Just taking a step back, the mix shift to casualty lines in both insurance and reinsurance, at least if I look at it on an earned basis, that definitely is up a bit year over year. It hasn't really increased much, I guess, over the past few quarters. Is that having any bit of an impact at all on the underlying loss ratios in either segment? How should we think about that going forward? At some point, it will, because I think the loss peak on the casualty line is a bit higher than the loss peak on the short-tail lines. I think the shift, the mix hasn't really changed fundamentally at this stage. I think down the road, it might. Great. Thank you. Next question will be from Rob Cox at Goldman Sachs. Please go ahead, Rob. Hey, thanks. Yeah, just curious, as you start to renew the MCE book, anything interesting you are seeing either on the delegated or the non-delegated side? You know, how far are we through the non-renewals on the programs book? I think what we've seen so far, and I think we've renewed, the entire book has been transferred to Arch. I'm personally very pleased with what we've seen so far. I think the stickiness of the business, the ability to provide additional lines of business to our distribution partners to be more relevant to them, the property expertise in the admitted property business that we really didn't have that we acquire—all those assumptions that we had made at the time of the purchase turned out to be true. I'm actually very pleased with the strategic decision we made to go for the acquisition. On the delegated side, the MGA, I think we knew we didn't do the deal because of the MGA portfolio that was coming with the acquisition. I think we started the remediation, and there, I think it's pretty much what we expected. It takes more time than you think because all these MGAs have not experienced. I think we'll see the impact really in 2026 of the non-renewal of the notice period that we've sent a number of those MGAs this year. Got it. Thank you. I just wanted to follow up on credit. I mean, just given the mortgage book and the investment in Coface and I think a relatively larger private credit book that you guys have, any thoughts on the credit environment and anywhere you're leaning into or out of, just given some of the noise in private credit? Yeah, I think you got to be careful, I'd say, in what we're looking at. No question that, you know, certainly maybe the headlines around subprime auto loans, you know, not performing well. I think that's a totally different type of customer than what our borrowers would be on the USMI front. I think that, you know, we're not seeing any of the same kind of results. I guess the proof is what we reported, you know, this quarter. Again, very specific around the type of borrowers in the U.S., the trade credit world. No question that there's been a couple of insolvencies that have made the headlines that, you know, Coface, we don't know, but may be exposed. That's for them to work on. There's no question that when these types of events happen, people will start to think a bit harder about dependencies in the credit and lines of credit they extend, etc. That's not unusual. At this point, we're very, very comfortable with the exposure we have. We understand it well. Obviously, we look and monitor all the external data and the trends that are happening. So far, there's nothing really that stands out that we think we have to adjust our thinking or our strategy. More specifically on Coface, I think this is short-term credit. The game here of the underwriting is really, as you're aware of, a weaker credit is really to over time cut your line to that particular credit name so that when the inevitable happens, your exposure is much less. I think they played that game really, really well. I don't know about the latest insolvencies, but historically, they've been very good at that. Thanks for all the color. Next question will be from Alex Scott at Barclays. Please go ahead, Alex. Hey, good morning. First one I had was just circling back on Rob's question on the remediation. Could you frame for us at all how much impact that could have on the insurance segment? Yeah, I just, you know, thinking through trying to dial in premium growth estimates and knowing how much some of us missed our reinsurance growth this quarter from not knowing about the transactions. I just want to make sure I'm layering in enough for this lagged remediation impact. Yeah, so specifically on the programs that we acquired, the premium that we've identified and has been, you know, not will be non-renewed is roughly $200 million. Again, as Nicolas said, the notices went out and then there's a notice period and then the MGA has, you know, three to six months to find another carrier. Some are more successful in getting a replacement sooner. Some of that may actually start happening in the fourth quarter. I don't have the precise projections of when it's going to hit the top line in each of the next few quarters. Just at least to give you an idea, call it $200 million part of a billion and a half to a billion six book, which was the overall MCE premium volume, is kind of the impact that we expect to see. The flip of that, though, is the middle market business that we really was attractive to us, was really what we were trying to get, has done very, very well. The rate environment both on casualty and property in that business has been very good. We just came back from a couple of industry conferences where our business partners are very supportive and they are very happy to do business with Arch. We like to think that some of that kind of headwind in terms of giving up or non-renewing some of those programs, we can make up some of that at least in the middle market side. Got it. That's helpful. Second question I had is on the reinsurance business and casualty specifically. The repricing efforts, I guess, are, you know, a lot of it's on the quota share of the actual underlying primary taking rate. Can you characterize what you're seeing there? I mean, are the underlying primaries taking enough rate where it's in excess of loss cost and it's actually building improving margin in there? Is that why you're speaking more optimistically about it, or is it still pretty, you know, obviously a high loss cost environment? I'm just trying to get a feel of whether that's actually improving or not. I think you got it right. We believe in casualty in general. We're getting more rates than the loss cost, and it's an elevated loss cost. That's what, if you back on the reinsurance side, if you back the right specialty underwriters, people that manage their limits well and avoid some of the heavy auto or other difficult class of business, you would want to do more business with them. Over time, we expect to be able to write more of that business. Okay, thanks. Next question will be from Andrew Andersen at Jefferies. Please go ahead, Andrew. Hey, thanks. Maybe you could just expand a bit on how you're thinking about 1/1 property cat renewals. Do you still see returns of kind of 20% here on this line? How are you thinking about ILS impacting kind of return levels in industry capital? Yes, on the cat side, we remain bullish. The outlook is bullish. We like the margin and maybe a couple of data points. The market really peaked in July 2024, a little bit over a year ago. I think in 2025, the price went down between 5% and 10%. We are into our second round of rate decrease. Depending on the region, the increase that we witnessed from 2021 to 2024, some of those rates doubled. I think we are in a good place. It depends on the region, but generally, we remain optimistic that the business is attractive. There's more demand. We had more demand last year. We expect more demand to come to the market in the U.S. on an international basis. Overall, we think, despite expected pressure on the rates, we think the margins are still very attractive. Thanks. I'll leave it there. Thank you. Next question will be from Meyer Shields at KBW. Please go ahead. Great. Thanks so much for fitting me in. I'll I'll try to be quick. I guess in the past, you've talked about ramping up some spending associated with mid-corp, but I was hoping we could get an update of timing and maybe amounts of increased spending. Increased spending, I think, was more the focus. No question that we got, I don't want to call it a bare-bones organization, but the people that transferred back in August of 2024 was, call it, primarily underwriters and claims people, right? That was the bulk of the staff that transferred. What we talked about at that time was that, yeah, we would need to hire to reinforce our capabilities in terms of actuarial, data analytics, and a few support functions here and there. We knew it would take some time. It's a competitive job market. We've been able to address some of that too. I think ultimately, it's still, I want to say, on the expense ratio on the OpEx side, I mean, we can run the incremental mid-corp business at a more efficient or lower expense ratio than we had pre-acquisition, given the synergies and kind of some of the infrastructure costs that we can spread to a bigger base. I think we still have a few, I'd say, openings that we're trying, both on the underwriting side and on the kind of support functions that we're trying to fill. We've done a lot of, a lot of the work has been done in the last year, and it's showing, right? The business is doing well, and we're able to execute on the strategy and try to grow in some specific areas. We're, again, a little bit of work to do, but we're in a good spot. Okay, perfect. Thank you so much. Yep. Next question will be from Brian Meredith at UBS. Please go ahead. Yeah, thanks. Thanks for putting me in. Two quick ones here. Just going back to the whole MC mid-corp and the program business runoff, the underlying loss ratio improvement in insurance, is that a direct result of some of the actions being taken there, or is that something else? Therefore, as we start to see this runoff, should we start to see underlying loss ratios continue to improve in insurance? It's more the latter. The impact of the non-renewables has not really come into play on an earned basis. The improvement, again, not huge this quarter, but I think there should be some benefit as this business runs off that we'll see some improvement or at least some stable loss ratios. Great. Thanks. Francois, I wonder if you could talk a little bit about the substance-based tax credits that Bermuda came out with. I think it was the end of September. What that impact could potentially be for y'all? A bit early to tell. No question, yes, the consultation paper is out. Comments have been submitted. We've had meetings with, you know, obviously, as an insurance community with the government expressing our views. The biggest, can I say, remaining item that we don't have clarity on is on the transition credits. I mean, at what pace will these kind of credits be allowed to be or reflected, starting in 2025? That is still to be determined. There's work being done on that right now. We expect to have clarity in the first, call it, first half of December. Clarity slash almost finality because it has to be enacted before the end of the year for us to be able to reflect it on our financials. You know, to your question, Brian, I think it will be substantial, we hope. You know, when we have, like, the law, I mean, we'll be very, very quick to share that with you all and give you a bit more color on what that might mean for us. Great. Thank you. You're welcome. At this time, I'm not showing any further questions. I would like to turn the conference back over to Nicolas Papadopoulo for closing remarks. Yes. Thank you for spending time with us this morning. We're looking forward to talking to you next quarter. Thank you. Thank you, sir. Ladies and gentlemen, again, thank you for participating in today's conference. This concludes the program. You may all disconnect your lines.