Company: MHLA
Filing Date: 2025-03-10
Form Type: 10-K
Source: 0001412100-25-000011
Chunk: 162

Company: Maiden Holdings, Ltd.
Filing Date: 2025-03-10
Form: 10-K
Item: Item 7
Chunk 162
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 fair value of that portfolio by $3.6 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 December 31, 2024 and 2023, these respective durations in years were as follows:

December 31, 20242023Fixed maturities and cash and cash equivalents0.81.2Reserve for loss and LAE - gross of LPT/ADC Agreement reserves6.45.8Reserve for loss and LAE - net of LPT/ADC Agreement reserves3.51.6

During the year ended December 31, 2024, the weighted average duration of our fixed maturity investment portfolio decreased by 0.4 years to 0.8 years while the duration for reserve for loss and LAE increased by 0.6 years to 6.4 years. The differential in duration between these assets and liabilities may fluctuate over time and, in the case of our fixed maturities, historically has been affected by factors such as market conditions, changes in asset mix and prepayment speeds in the case of both Agency MBS and commercial mortgage-backed securities held. At December 31, 2024, the duration of loss reserves net of the LPT/ADC Agreement was higher than 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 December 31, 2024 and December 31, 2023, 51.1% and 40.8%, respectively, of our fixed income investments were comprised of floating rate securities which are detailed in the table below:

December 31,20242023($ in thousands)Fair Value% of TotalFair Value% of TotalFloating rate securitiesCollateralized loan obligations$60,703 13.6 %$78,803 13.0 %Total floating rate A