Arch Capital Group Ltd - 4.55% PRF PERPETUAL USD 25 - Ser G 1/1,000th Int

Strong Q2 earnings + capital generation (good) - After-tax operating income: $893m ($2.56 EPS). - Book value per share +2.8% in Q2 and +4.5% in 1H26. - Overall ex-cat accident year combined ratio: 82.5% (up 160 bps YoY, explained mostly by mix and market pricing changes), with $165m favorable prior-year development pre-tax (4.1 pts). - Cash flow from operations: $1.3b (very strong).

Underwriting performance was solid but impacted by two negative shocks (bad + surprising) - Insurance segment: underwriting income $27m depressed by cat losses tied to the Iran conflict (most of the insurance cat load); also some US convective storm impact noted at group level. - Despite Iran impact, Insurance current accident year combined ratio ex-cat: 91.6% (good underlying). - Current quarter cat losses: $201m net of reinsurance/reinstatements. - Guidance-style expectation: annual group cat load quoted 6–8%; Morin emphasized Iran losses were real claim/case reserve impacts (not just hypothetical IBNR).

Reinsurance excellent, but reflects softening pricing + mix (mixed) - Reinsurance underwriting income: $410m; ex-cat combined ratio: 79.9%. - Current ex-cat combined ratio up 270 bps YoY due to mix changes and lower pricing in property. - Net premiums written -10% YoY (clients retaining more risk, competition lowering rates—especially property; also more cessions to traditional reinsurance/third-party capital affecting net-to-gross).