Fairfax Financial Holdings Limited ($FFH)

Good morning, ladies and gentlemen. Welcome to our 41st Annual Meeting. Thank you. 40 years since we began in 1985. I'm Prem Watsa Chairman of Fairfax, and it's great to see all of you here. This is such a big pleasure for all of us at Fairfax to have all our wonderful shareholders with us. Many 25, 30 years with shares in our company. Welcome to all our shareholders and employees across the world. It's being on the Internet and to all the people who support us. So I wanted to begin by just saying that 40 years is a long time. 1985, the Dow Jones in that time was about $1,000 plus or minus. And at that time, when you looked at the company's earnings, it used to be net income and net income 6x, 7x, 8x 1985 long time ago. Then the Dow Jones went to $5,000, $10,000, $15,000, $20,000. And then you had to change, justify these high prices. So we went to EBITDA, earnings before everything, interest, taxes, deficit. And it worked for some time. And -- but then we went to $40,000 and now we are heading close to $50,000 on the Dow Jones. And so as you'd expect, we had to use a better formula, and that's this. EBITDA, earnings before Iran, tariffs and Donald's announcements. I don't know what the next variation is going to be like. So we celebrated our 40th anniversary since we began best year in history, as you know, net income increased to $4.8 billion, and our company has been transformed since 2022. I've said that for the last 4 years. Gross premiums were up in the 4 years by 40%, underwriting profit, 127%. Interest and dividend income is up 302%, and book value per share is up 100% in those 4 years, and book value increased by 21% in 2025, $1,260 per share. That's in U.S. dollars. And our stock price increased by 31% in Canadian dollars, $2,616. Now you'll remember that we announced that with passing of Mr.Athapan, one of the world's best underwriters, we were instituting a cup to be awarded to one company each year for underwriting excellence, and in 2024, that award was presented to Silvy Wright and Northbridge. This year, this year, I'm happy to announce the award goes to Allied World. We acquired Allied World in 2017. It's been a phenomenal performance. I've said it in our annual report. Okay.

Do I get to take this with me?

You have to return it. We've got something else for him, but this is a rolling trophy. Congratulation. Thank you. Last year, we also announced an award in honor of Ricky Salsberg, who is the heart and soul of Fairfax. We are very pleased to announce that 2025 winner is [ Arlene Paladino ] and she is with Crum & Forster since 1979, became the CFO in 2017. And since then, she has built a best-in-class finance department and influence extends right through the company, most importantly, she exemplifies our culture. [ Arlene Paladino ]. Thank you, Arlene. Thank you so much. Arlene 1 minute, 1 minute. This is the the plaque that comes, her name is going to -- that's Silvy Wright right there. Bijan was last year's winner and Arlene is this year's winner. Also in the owner of Rick Salsberg, we announced that we would help fund our Memorial Leadership Lecture Series in Ricky's name at the University of Toronto, Law School. We are happy to say the inaugural lecture was held January of this year in front of a packed house, and involved a panel of established leaders, a ton of lawyers and it went really, really well. I invite you to join us for the next one in 2027. As we've often said, our people are our greatest asset. The health of [indiscernible] well-being remained our top priority. It's now almost a year since we last Vinod,and we continue to honor his memory by strengthening our focus on the heart, health of our employees and our families. This commitment has already saved many, many people across our organization, and we give these tests -- we look after pay for these tests all of our companies in the world. The Fairfax Innovation Award was created in 2017 many, many years ago and to recognize teams whose innovations have had a transformative and positive impact on their organization this year, an impressive 33 initiatives that submitted with a diverse range of innovative products. It's fantastic to see that's the beauty of decentralization. All Fairfax companies continue to innovate within that market. And after reviewing all the submissions, we are happy to announce that ARX from Ukraine had been selected as the winner, and we have, I think right here -- ARX defied industry, that's right from Ukraine, defied industry expectations by launching a sustainable war risk insurance product. Congratulations to the team. It is now more than 4 years since Russia invaded Ukraine. And as I mentioned last year, our presidents are keeping our people safe and they are heroes working under extraordinary conditions, and our business is doing exceptionally well. Now I want to take a moment to recognize. I want to take a moment to recognize [ Andre Aliski ] and Slava from ARX [indiscernible]. Very happy to have [ Aliski ] here in person. [ Aliski ] come right in. Give him a nice round of applause. And I think you can see [ Aliski ] all over the world where get this. But [ Olesky ],thank you for joining us, and thank you for the wonderful work you've done in Ukraine. Give a nice round of applause.

Thank you. I am not going to miss this opportunity to say a great thanks for you Prem and for whole Fairfax. Behalf of all our employees of my colleagues in Ukraine because we are feeling strong support since the first day till now, and we believe till it will be necessary. Thanks a lot.

Thank you very much. With the contact in Iran, unfortunately, members of the Fairfax family once again found themselves in harm's way. GIG management is ensuring that all our employees in the Gulf region have the support that they need to stay safe. A big thank you to Bijan, Fareed and Paul Adamson, give them a nice round of applause. You know we treat our employees as one big family, and we do not want to have layoffs like you have seen recently in the tech industry or other industries, particularly when they're in such strong financial shape. We are careful in adding employees because we don't like layoffs. While Fairfax and our employees have been a Great Place To Work, where we do not tolerate or condone any form of racism or discrimination, we still know that it has not been eradicated in our society even in 2026. As you know, in 2020, we created the Black Initiative Action Committee at Fairfax under the Chairmanship of Craig Pinnock, the CFO of Northbridge to make our company even more attractive for people in the black community and other minorities. We're grateful to say we have maintained our strong partnership with the Black North initiative, reaffirming our commitment to eradicating anti-black systemic racism through collective efforts across corporate Canada. But when I speak of racism, we are shocked and saddened by the anti-semitism that has risen in Canada, the United States and many parts of the world. It should not be tolerated. There is no place for anti-semitism period. And I wanted to make sure we all understand that. Since the inception of Fairfax, we have always been focused on a few things. The way we operate, the way we treat each other and the way we help our communities. Our management team and Board ensure that honesty and integrity are never compromised, and that full disclosure is provided to all our shareholders. We follow the golden rule, treat people like you want to be treated yourself. We now have 22,000 employees around the world working in our decentralized environment following this basic principles. I'm pleased to say we recently posted our fifth ESG environment, social and governance report on our website and we're always focused on ESG. But when it is our fifth report, we have been following ESG principles since we began 40 years ago. We just didn't call it ESG. I've always said this, and I repeat, we are very blessed to have such a wonderful group of shareholders, long-term shareholders, many, many of you have been shareholder for 10 years, 20 years, 25 years, and maybe even longer. And through the ups and downs of business life, so warm welcome again. Now the biggest asset that we have is not on the balance sheet. The biggest moat in our company is our culture, and it's not on our balance sheet and the creation and preservation of that culture, the biggest achievement for us over the past 40 years and the continuing driver of our success. And it will continue because Fairfax is not for sale. I've considered myself before I've told you as a steward, I don't own the company because I cannot sell it, stewards can't sell. And I am looking forward to this company going forward long after I'm gone. So the fair and friendly culture, which is in our name is why companies all over the world want to deal with us. It's our biggest advantage and regard it fiercely. They trust us. I also want to take the opportunity to thank our directors, all 12 of them for their strong support of our company. Now one of our directors is retiring Robert Hartog, our Lead Investor, Lead Director and Chair of the Audit Committee since we began in 1985, many of you might remember, Robert, Introduce me to David Johnston when Robert retired in 2006. We had lunch and thus with a lunch with David and thus, began a 20-year relationship. David was the dean of the law school at the University of Western Ontario, principal of the University of [indiscernible], President of the University of Waterloo and Chair of the Harvard Board of Overseas, the Harvard Board made David, Chair. David, with the best Government General Canada has ever had. We were very fortunate to have David as our Director, all these years, and we wish David and Sharon, their 5 daughters, and hear this, 14 grandchildren a long and happy retirement. Let's give David Johnston, a nice round, standing ovation for David. David will always be a friend of Fairfax and very close friend of me. Over our 40-year history, we have always operated at Fairfax with an outstanding small team with great integrity, team spirit and no egos, protects our company from unexpected downside risks and which takes advantage of opportunities as and when they arise. This group has worked together for a long time with trust and long-term focus, as you will see in my presentation. But I want to recognize Peter Clarke, who is our President, has been with us for 29 years and his first job with his Fairfax and he will join me for the presentation. He's going to do half the presentation, I'm going to do half after we -- and he'll join me for the Q&A also after we go through the formal part of the meeting. And Peter runs now all our quarterly conference calls with Amy Sherk, our CFO, and Wade Burton, our Chief Investment Officer. Peter Clarke, let's give them a nice round of applause. I am not retiring but I wanted all of you to get to know our talented team. I am watching, of course, with great interest. In November 2025, we announced that Bill McMorrow and his management team will take Kennedy Wilson private with the help of Fairfax. We have invested with Bill since 2010, and have done exceptionally well over that time period. All our investments with Bill and Kennedy Wilson have worked out very well. So when Bill suggested, we take Kennedy Wilson private, we were very pleased to be a partner, and on February 17, 2026, Kennedy Wilson announced that the special committee had accepted $10.90 per share from Bill and us, a 46% premium from the price of $7.47 since it traded at, before the offer. We are very excited to have Bill, Matt and his team joined the Fairfax team. So I wanted to give them a nice round of applause. Will McMorrow. Now I wanted to -- we didn't have a chance to thank Alan Kestenbaum of Stelco. And I think Alan is right here. And we put some money with him about $200 million at $20 a share. He called me one day at about 10:00 at night and said time to sell for $70 a share. And I said it Alan, I thought you were looking at $140 and he said $20 to $70 Prem is much easier than $70 to $140 and he timed it perfectly. And at the rate of return for us, this is in 2018, we sold it in '24, 29% in 6 years Alan Kestenbaum. Give him a nice round of applause. Then I got to also introduce Sigma, a waterworks construction company. This is a friend of mine who have been my friend for 58 years. We went to the same engineering school in India. He created a company, and he sold it about in 2007, and 10 years later, we helped them acquire it back again in 2017. And we invested $41 million, and he gave us back $327 million, a compound growth rate of 31%. [ Victor Pious ], gave a nice round of applause. And finally, I wanted to thank David Sokol. We put some money with David at 2018 quite some time back, and at $6.50, we put more money in and eventually, we put $1.2 billion with David at $9.40 and we've just sold half, as you've seen half our shares at $28.30. The biggest gain we've made and because of David Sokol outstanding entrepreneur, outstanding manager, done a fantastic job, a 25% compounded rate of return. David Sokol, give him a nice round of applause. So I wanted to recognize all of them. And just very quickly, Jonathan Alderson, many, many young families suffer from autism. Jonathan has done a wonderful job. He's here is developing something called Thrive. I bring that to your attention again. In January of this year, we had our investor trip. We have an investor trip to India, and we had restarted it last year after a 5-year gap due to the pandemic. And we talked about it last night. It's an outstanding trip. Trip of a lifetime and it gives our shareholders an opportunity to interact with the leadership. And you meet lots of our companies in India, and you really have a wonderful, wonderful time. And all the participants who go for this trip think it's a trip of a lifetime. And this time, Peter Clarke and Louanne will be joining the trip. So you'll really get to know Peter over that week, Peter Clarke, why he's such an exceptional guy. And the dates are from January 9 to the 16 in the foyer outside the auditorium, you can proceed to Thomas Cook both for more information. [indiscernible] that recommended highly, it's limited to 25 couples. That's our trip of a lifetime. And I've introduced our management team in the past. They're all here. You have a chance to see them. Our President of our companies, President of many of our Noninsurance companies, and you saw the pictures going before we began. These are the leaders I happen to be one here, but these are the leaders who keep Fairfax going. That's why I'm so excited about the possibilities for Fairfax, all the leaders that we have here. And we are really blessed with a very unusual group of smart, hardworking and trustworthy leader companies. You'll see their long tenure. I'm going to talk about that. In the foyer, we have about 38 booths of the company's, our insurance companies, our noninsurance companies. The company that serves some food, like recipe and cake, they're all there. And the leaders are there to answer any questions you might have. We have the IVY Business School showcasing the [indiscernible] Chair for value investing with Professor George Athenos [indiscernible]. He had another conference yesterday outstanding what he's done and brought value investing to Canada and one of the best value investing conferences in the world. We have the co-op students from the University of Waterloo. And then I just wanted to say we began a donations program about 35 years ago, and it's gone up very significantly, but under the leadership of many, many people, this has been produced why we give. It's a really lovely document. It's by all of our individual companies, insurance companies and then we put 2% is what we donate, 1% goes into the foundation and for bigger projects. And it's really well done. I recommend it to you on your way out, you can pick it up. And then we are also -- we are happy to give you this one you have to pay. This is 50 years of Chairman's letters, you can easily get it. If you want to -- some of you might want to look at it. Most of you don't want to, but it's available costs you $50. And Dave Thomas has done a terrific book for us. This is really we meant it for our own people, but he is selling it. And we really thank him, done a terrific book The Fairfax Way. It's also discounted at $20 for the book. And Dave is right here, give Dave a nice round of applause. It's a lovely book. And our latest investment Under Armour has got a nice hat for you with Fairfax and not expensive and beautiful back pack also for sale, not for free. They've really produced very, very good products, as you'll see, and I think that gets me -- so as we've done in the past 40 annual meetings, we go quickly through the formal meeting, give a short presentation with slides and have a Q&A with Peter and myself after this slide. So should be just -- and you can submit your questions in real time on this platform. So you can send it. We've got Jeff, Stacey there, and he will have 1, 2, 3, 4 stations plus Jeff -- and to take any of your questions after the presentation. So now let's begin the formal part of the meeting. Thank you. And the formal part of the meeting is ladies and gentlemen, welcome to this meeting. I'm Prem Watsa Chairman. Derek Bulas, is the Vice President and Chief Legal Officer; Corporate Secretary of Fairfax. I shall appoint Shirley Tom and Louise Waltenbury of Computershare Trust Company to act as scrutineers and to complete the vote of any polls taken at this meeting and to report thereon to me as Chairman. I can report that as a result of reviewing an affidavit of mailing and a preliminary report of this scrutineers. I'm satisfied that notice of this meeting has been duly given and a quorum is present, that this meeting is, therefore, properly constituted called and constituted. Today's agenda will consist of the of tabling the annual report, which is here, nice 40 years, nice color, you can't miss it. And that's there for you. It's to elect our Board of Directors; second, to reappoint our auditors, and third, to consider the shareholder proposal that we received from investors for Paris Compliance on behalf of the [ Salal ] Foundation. I propose to move quickly through the formal business. announced at the minutes of the previous annual meeting held on April 10 are available for inspection, by a request to the Fairfax Corporate Secretary as well and now formally place the annual report, which includes the company's financial statements, the auditors, Price Waterhousecoopers statement. And I declare that the total number of votes attached to the shares represented in the meeting by proxy have been directed to be voted in favor of the election of the Board of Directors, and the reappointment of our auditors, in each case, not less than 94% of all votes. Finally, I declare that the total number of votes attached to the shares represented at the meeting by proxy which have been directed to be voted Against the shareholders' proposal is not less than 80% of all votes that may be cast at the meeting. So voting today will be conducted by electronic ballot for those attending. And for here, there will be a show of hands, and I'll ask for the balloting to be opened to the registered holders and appointed proxy holders. The polls are now open on the platform. And at this point, all registered holders and proxy holders attending virtually who have properly logged in, will be able to vote. Following the presentation, Jen Allen will confirm when the polls are closed. Once the electronic balloting closes, your votes will be submitted. So now I'll go to the election of directors. With your consent, I will now move directly to the election of directors. I now invite nominations for directors.

I am Jennifer Allen, and I nominate as directors for the corporation for the ensuing year. Robert Gunn, Karen Jurjevich, Christine Magee, William McFarland, Christine McLean, Brian Porter, Lauren Templeton, Benjamin Watsa, Prem Watsa and William Wilton.

Thank you, Jen. Are there any further nominations? As there's no other nominations for directors have been received, and as the numbers of directors nominated is exactly the number to be elected, I confirm that those 11 nominees are proposed for election as directors of the company. Given the hybrid meeting and the fact that we will also conduct a virtual vote, we will have a vote on this together with the next resolution. I now invite a resolution regarding the appointment of an auditor.

I move that PricewaterhouseCoopers LLP be appointed as auditors of the corporation to hold office until the next annual meeting.

Thank you, A.B.

I'll second that motion.

Thank you. And for those attending in person, I would ask that you please vote for resolutions 1 and 2 by a show of hands. All in favor? Any contrary? Can't see any contrary. The final item of the business is to consider the shareholder proposal submitted by investors for the Paris Compliance on behalf of the [ Salal ] Foundation. At this time, I recognize Kira Taylor, representative of investors for Paris Compliance to present this proposal and take a motion that is to put to vote. Mrs. Taylor. Please go ahead.

Good morning, Mr. Watsa, members of the Board and fellow shareholders. I'd like to start where I believe we agree. Fairfax has built something genuinely rare, a company built on long-term thinking, patient capital and stewardship over decades. In a world obsessed with quarterly results, this is a philosophy worth defending. It also provides a useful lens when considering the proposal before you today. Climate risk already costing hundreds of billions in damages each year is becoming an increasingly larger risk as time goes on. For an investor, this will influence winners and losers in the equity market and for an insurer, it greatly affects underwriting risk. Fairfax has already stated that climate change represents a material risk to its business, the question raised by this proposal is whether shareholders have sufficient transparency to understand how that risk is being measured and managed across the enterprise. The Board has indicated that Fairfax is already assessing climate-related risks internally. That work is important and encouraging. At the same time, investors rely on disclosure to evaluate how material risks are being addressed. Internal analysis does not provide investors with decision-useful information. For example, the commitment to hold assets over the long term invites reflection on the kinds of exposures that are being financed and underwritten over that same time horizon. Shareholders need insights into the significant exposure Fairfax has to high emitting sectors, which face transition risks set to compound over decades. Fairfax is currently the third largest underwriter of fossil fuel projects globally, the Iran oil and gas shock has exposed the serious security vulnerabilities of fossil fuels. Sharing Fairfax's financed emissions disclosures with appropriate context around estimates and evolving methodologies would help bridge that gap. It would allow shareholders to better understand the company's exposure and to track progress over time. There has also been discussion about timing, including whether such disclosure is premature in advance of regulatory requirements. Many investors view voluntary disclosure of material risks, a good part of -- good governance. Therefore, investors already expect this disclosure, particularly when many peers have taken similar steps, some several years ago already. The Board has also highlighted data challenges. These are widely recognized across the financial sector. Most large financial institutions have already begun reporting financed emissions and clearly note assumptions and limitations so that their processes can improve over time. Without trying, there can be no iterative process. Beginning with an initial disclosure can help establish the systems and governments needed for more refined analysis later. Finally, Fairfax's decentralized structure is a strength that allows for entrepreneurial management and local decision-making. At the same time, investors evaluate Fairfax on a consolidated basis and group-level disclosure complements that structure by providing a clearer picture of overall performance, just as we are doing here today. This proposal is intended to support that complementary process. The request itself is modest. It asked Fairfax to disclose financed emissions across material scopes in absolute terms as a first step. This is not a request for targets or strategic shifts, but for measurement and transparency. Fairfax has an identity as a contrarian institution that resists noise, pressure and market fashions and that instinct has served the company well. But I'd ask the Board to consider whether in this case, that same instinct may lead to filing climate risk in the wrong category, as simply outside pressure to be resisted rather than systemic long-term financial risks. Thank you for your consideration.

Thank you very much. Ms Taylor. Would someone second the motion?

I second the motion.

Thank you, Ms Wang. And I would direct your attention to Schedule A of Fairfax's management policy circular, which describes in detail the position of the Board and management of this matter. The Board of Directors recommends that shareholders vote Against this shareholder proposal. We will now proceed to a vote on the shareholder proposal. For those attending in person, I would ask that you please vote a show of hands. And then again, remind those attending in person that our Board recommends voting against this proposal. All in favor? Contrary? Thank you. We will now take a brief pause for 60 seconds to allow registered holders -- to allow our registered holders and proxy holders to complete the electronic boarding and all the motions brought forth at this meeting. Jen Allen will start a time-up. [Voting]

Mr. Chairman, the voting is now complete, and the polls are closed.

Thank you very much, Jen. I have been advised by the scrutineers that the policies -- the proxies deposited for the meeting have now been voted. I can confirm that the nominated directors have been appointed as directors of the company to hold office until the next annual meeting. In addition, I confirm that PricewaterhouseCoopers has been appointed as auditors of the company to hold office until the next Annual Meeting. And on the shareholder proposal, the voting results show that -- approximately 80% of the votes casts were against the proposal. As there are a greater number of votes against than in favor, this motion is not carried, and the shareholder proposal has not passed. We will now file -- and we will file a report on SEDAR setting out the voting results following the meeting. I propose now to terminate the meeting. After that, I'd like to talk about our company plus a Q&A session. I now invite a motion for termination.

I move that this meeting be terminated. Thank you, Jen.

I second the motion.

Thank you. Amy, I declare the meeting terminated. Thank you very much. So now we go to our presentation. Now we've done it for a long time. Peter come on in and Peter is going to take -- I'm going to talk about some of the principles and Peter is going to talk specifically. Peter is going to talk about the operations of the company. And so we'll just go straight into the presentation, and then we'll open it up for Q&A. So we always start with our guiding principles. There's a moat, a set of principles that distinguishes Fairfax is these principles. The objectives very simply to provide outstanding service to our customers look after our employees who provide that service, make a return for our shareholders and never forget the communities that we operate in, recognize that we're all very fortunate. Always, you can take a long-term view unless you're soundly financed and always provide full disclosure to shareholders. Second is structure. I have found decentralized structures that we've had all these years in spite of the ups and downs, works wonderfully, and we are decentralized, except for performance evaluation, success in planning, acquisitions, financing, investments that have come -- that are done by Fairfax. Complete and open communication between our companies and ourselves. We've done it for years. Share ownership, large incentives encouraged only for performance, not for the top line, very dangerous in the financial business to have incentives for the top line. And we remind ourselves, we are not an operating company. And our values are most important section here, right in the first one, understand integrity, essential in all our relationships, will never be compromised. Results-oriented, not political. It shows you the type of people who feel comfortable at Fairfax team players, no egos, confrontational [indiscernible] not appropriate. We value loyalty to Fairfax and our colleagues. We follow the golden room. We treat others as we would want to be treated. Hard working, not the expense of our families. We -- that's an odd one to put in that company, but we do, we don't want to succeed at the expense of our families. And we always look for opportunity. We're always looking at the downside making sure that we survive the downside and then look at the upside. And we make mistakes. We made a ton of the sake, most of you who have been with us for a long time, will remember them. And but we try to learn from them and go forward. We never bet the company on any project or acquisition, and we believe in having a few laps at the office. So that's our values, and it served us very well for a long time. Here's the golden rule, and I've shown you this before. That's about 20 [indiscernible] groups, that's -- they all follow this principle. So this time, I wanted to just take today, what is hateful to you do not do to your neighbor. This is the whole [indiscernible]. All the rest is commentary. Right from [indiscernible]. About Islam, not one of you truly believes until you wish for others, what you wish for yourself. How about Hinduism, taking the big ones. This is the sum of duty do not do to others what would cause pain, if done to you. And finally, Christianity in everything due to others as you would have them do to you. But this is the law and the prophets. Amazing, other the other faiths have the same principle. Do to others what you want done for you. And we've tried to follow that all these years. Our formula is very simple. I've shown it to you for 40 years, disciplined underwriting, not on the top line, value investing and over that time, you get superior long-term returns, not in any 1-year or in 5 -- years, over time. And that's our rate of return there. The 40-year compounding, you can see there -- and our stock price was 3.25%, 3.25%, 3.23% to be exact, but 3.25%. And it's created a $1,900. That's in U.S. dollars, Fairfax stock price, book value is in U.S. dollars, too. And you can see the S&P 500 during that same time period. The rate of return. Our stock price has gone up 19.5%. And if you look at -- this is a fascinating slide. I showed it in our annual report, and I just highlighted for you. It's very end-date sensitive. So 2020, they looked at $434 million, our rate of return was still pretty good, but 16%. And as the stock price goes up, 19.5% rate of return over time. The last 5 years have been very, very good to us. I've told you before that in 1985, there were 6,000 companies listed in the United States. 6,000 on all the exchanges, 600 still continue in their present form. The rest of them have taken over bankrupt whatever. They don't exist in that form. And then you say, how many companies did get more than 15% return, and that's 56 companies and which is less than 1% of the 6,000. And we are very grateful and very blessed. We are fortunate to have a 19.5% return and you can see that ranks us #7 -- in the -- if you look at the profits in Canada, net income last year, we made $4.8 billion, and you say, where does that rank us? That ranks us at the 10th largest company in Canada. And this is a company that never made $1 million in 1985, prior to 1985. So we're very, very grateful and not proud, but grateful, grateful means you didn't do it yourself. You had blessings from above. And so that's why we're not proud, we are very grateful for all the blessings we've had. Who has done it? All of this is from our executives Peter and I are there, but you can see Andy Bernard, you can see you can see Brian Young, they came together as a team. And Johnny Varnell, you can see at the last line there, 39 years. And you can see Peter Clarke has been with us for 28 years. This is ending last year, and now 29 years with lots of our officers have been with us for a long time. Outstanding management, you can see Brian Young there, as I told you 30 years, Khaled second row to the right just retired 48 years with GIG, 48-year GIG was just been formed. And then you can see Vasili, which is as a third row right to the right. Vasili's 18 years. He's taken over a year of life, and Alex has become Chairman, and he's also Chairman of our Cyprus Company that we acquired and been with us for a long time. And then if you go to the next one, the outstanding investment team that we have, [indiscernible] 40 years here, worked with them for at least 10 years before that. Brian [indiscernible], 39 years, another 10 years before that. And so we've worked together for more than 50 years and young Wade Burton, 18 years taking it forward. Wade Burton is the succession for us, but you can see all the others that we have and the time they've been with us. Chandran there for 32 years, and lots to lots of gratitude for that management team, holding company presidents and the investment committee. And with that, I'm going to pass it on to Peter Clarke, who's going into the operations, give them a nice run of applause.

Thank you. Thank you very much, Pam, and good morning to everyone here today. You might have seen this slide before, but this slide is a high-level view of our insurance operations that generate the $33 billion of gross premiums we write. Not included in this, is the nonconsolidated companies, Digit, Albingia and BIC, which would add another approximately $2 billion to this number at the 100% level. The 7 companies starting on the left, make up approximately 80% of our gross premium, primarily in North America, although many have global operations, in particular, Odyssey Group, Brit and Allied World. The remaining 20% of our premium is our international operations. Although only 20% of the total, it is over $6 billion in premium, and that is more than all of Fairfax 15 years ago. We are very excited about the prospects of our international operations. In many of the countries, the insurance penetration is very low, and we expect it to increase. Supported by strong GDP growth in those countries. Each of our companies are separately capitalized, as Prem said, with the President, CFO and run on a decentralized basis. This structure not only provides the many benefits of empowering our people but provides great financial flexibility for the group and a very flat structure where information can flow very quickly. As we always say, bad information, bad news comes up quickly, goes right to Andy and Brian, then to Prem and I, and the good news can come on the regular quarterly reporting. Over the past 40 years, we have built out our insurance operations to be 1 of the top 20 property casualty groups in the world. Not easy to replicate, especially in the short term. As we have said in the past, the company has been transformed since 2017, this corresponds with our acquisition of Allied World and a hard insurance market that began in 2019. Underwriting profit, you can see, increased from a loss of $600 million to a record profit of $1.8 billion in 2025 with 3 consecutive years of underwriting profit above $1.5 billion. Within our underwriting profit, we have absorbed on average $1 billion of catastrophe losses in each of the last 3 years and had favorable reserve development each year. Interest and dividend income has increased from $600 million to $2.6 billion, and our share of profits of associates has increased from $200 million to almost $1 billion. Today, all steady contributors to our net earnings. And you can see our investment portfolio at approximately $40 billion in 2017 has almost doubled to $75 billion in 2025. In total, our operating income, this is for our insurance companies only has increased from a loss of $200 million in 2017 or income of approximately $1 billion normalized for catastrophe losses is $4.6 billion today up over 4x over this time period. And most importantly, our shares outstanding have decreased from 28 million to 21 million at year-end. That's a 25% decrease over that time period. So when we talk about all these metrics on a per share basis, they have increased significantly more. . For the last 3 years, we have said we can see a strong base of operating income, now running at $5 billion on a consolidated basis, and we continue to see that for the next 3 to 4 years. Of course, nothing is certain, so there's no promises. This consists of interest and dividend income of $2.5 billion plus. Underwriting profit of $1.5 billion and share of profits of associates of $1 billion plus as well. All this adds up to the $5 billion of operating income and potentially earnings of $150 per share after taxes, interest expense and other expenses. This is before any net investment gains or losses on our net income. Although net gains has always been a significant contributor to our growth in book value, you can only look at that over the long term. Gains will fluctuate from quarter-to-quarter or for that matter, year-to-year, both up and down. And in our mind, that's only important over the long term. Now for our income statement for 2025. As I said before, gross premiums of $33 billion. That's up 2% from 2024. And we continue to benefit greatly from our scale and our diversification of our premium base both by geography and by product. Our combined ratio was 93%, producing an underwriting profit of $1.8 billion, notwithstanding significant losses from the California wildfires in the first quarter of 2025. As Prem mentioned before, I should note, we have no top line targets at Fairfax or none of our companies are compensated for top line growth. Everything is bottom line and focused on underwriting profit. Investment income was very strong and included net gains on investments of $3 billion, producing an overall investment return of 9.3% for the year, an excellent return in 2025. And finally, this resulted in net earnings for the year, record earnings of $4.8 billion and a growth in book value of 20.5% adjusted for our $15 dividend. Prem has mentioned every year the importance of float and how it is a huge benefit of the Property and Casualty Insurance business. And I just wanted to repeat that once again this year. Our float exceeded $40 billion in 2025, almost $2,000 per share and is compounded by 18% since inception. Over the last 10 years, we have had cumulative underwriting profit of $8 billion or a benefit of 3.2% on our float. That means we were paid to hold the float. And the last 5 years, cumulative underwriting profit of $7 billion or a benefit on the float of 4.5%. And this is before any investment income off the float. You can see why we really like the Property Casualty business. As I said before, we benefit greatly from our diversified global operations. We operate all across the world. We have 22,000 employees with underwriting operations in 50 countries, and we do business in over 100 countries. You can see we have most of the world covered. And over the last number of years, we have been focusing on organic growth, which our companies have done an exceptional job at during the hard market, more than doubling our premiums. We benefit greatly from the experience of our presidents and the management teams that run our companies, especially on managing the cyclical nature of the Insurance business. This is very, very important, not only in the hard market years, but likely more important than the soft markets. Our investment portfolio is $75 billion and is managed by [indiscernible] Watsa on a long-term value-oriented philosophy with capital preservation of priority. The investment portfolio is well positioned today to take advantage of the volatile macro environment with over 40% of the portfolio in cash and U.S. Canadian government bonds. Interest and dividend income of $2.5 billion has an average maturity of 3-years. Our Mortgage portfolio in partnership with Kennedy Wilson continues to produce outstanding results producing stable interest income. And our portfolio has limited exposure to corporate credit and anything we do have is very short term and no private credit other than positions in other strategic investments. Our common stocks at 25% of our portfolio are very well positioned with great management teams and we believe continue to have significant upside over the long term. Not included in our portfolio or in our book value at year-end is $3.1 billion of market value that is in excess of our carrying value for our investments in associates and listed consolidated noninsurance operations. Adjusted for the increased valuation of [indiscernible] or Atlas, from our recently announced sale, that total unrealized gain was $4.2 billion. or about $200 per share on a pretax basis. At year-end, we carry Poseidon at $15.50 per share. That was our carrying value. We had a fair value of $20 per share, and in the first quarter, we announced that we sold half our position at $28.30 per share. This represents a pretax gain of $865 million. But like I said, the difference between market value and carrying value is not in our book value until the sale is realized. Interest -- increased interest and dividend income has been a significant contributor to our increased earnings for the last 3 years, and we expect that to continue. Our current run rate is approximately $2.7 billion today. Prior to 2023, with interest rates at historical lows, our duration was less than 1.5 years and provided us the opportunity to extend duration and benefit from higher rates as interest rates increased significantly in 2022. We continue to have great optionality in our fixed income portfolio with 20% in cash and short-term treasuries. And as I said before, with very limited exposure to corporate credit. And as we wait for opportunities to arrive, we are earning a 5% return on our fixed income portfolio. [indiscernible] Watsa has produced excellent investment returns over the long term with an average return of 7.7% since inception. You can see there's only been 4 years in 40 that we had an investment loss in the year, and each of those were primarily due to unrealized mark-to-market losses, which reversed in the following year. Capital preservation is key, and [indiscernible] Watsa has done an exceptional job at protecting on the downside. You can see how our investments performed in some of the most significant declines in the markets. Namely 1987, the dot-com bust in 2000 to 2002, the global financial crisis in 2007 and 2008 and then again in COVID in 2020. Finally, our financial position remains very strong and is always our first priority. Our holding company cash and investments is at $2.7 billion at year-end. In addition, in the holding company, we have investments in associates and consolidated noninsurance investments of $2.2 billion. We continue to opportunistically refinance our near-term maturities with a target of no significant maturities for 3-years and have a $2 billion credit facility. Our shareholder equity increased $3.3 billion in 2025 driven by net earnings, and we purchased 1 million shares for $1.6 billion during the year. Our debt leverage ratios remain within our targets and we expect will trend lower as our equity base continues to grow. Our leverage increased year-over-year from the refinancing of our preferred shares with 30-year debt with favorable economics and our interest coverage before gains is very strong at 9 to 10x interest expense. Our insurance companies are well capitalized, with strong net earnings producing excess capital that will provide significant dividends to the holding company. We have many opportunities to allocate capital, including growing our insurance operations, at the right time, acquiring minority interest in our existing companies, attractive investments and of course, buying back our own shares, none of course, at the expense of our financial position. Thank you, and I'll now pass it back to Prem.

Thank you again. So just a few more slides and then we'll open it up for Q&A. Noninsurance investments, you can see Recipe, Peak, Sleep Country, all of them there. $8.5 billion of revenue. And the $400 million is reflecting the all other. We took some write-offs, $137 million. But if this is all [indiscernible] of course they are 100% owned. But if you take the associates, which is like 20% above 20% to 50% associates like Seaspan, Eurolife, you get about $1 billion. That $397 million, $400 million, take the write-off of and then you add the associate at about $1 billion that Peter was talking about. Investments in India. We've taken it in terms of fair value, $4.3 billion. But if you take the amount we control, it's more like $7 billion plus. And this is the equity. If you take the enterprise value, it's much, much higher, but this is the equity that we have. And Fairfax India, we think, as you heard in that Fairfax India presentation, the returns could be much higher in the future. Eurobank, this is really a fantastic experience for us. I gave you the stock price, EUR 31 1-year and then EUR 38, EUR 0.38. And here the euro price and the net cash invested was about EUR 1.1 billion. And then [indiscernible] who's here with us, who runs Eurobank, pays out more than 50% in either a dividend or a stock buyback. Because we own 1/3 of the company, we have to sell. We can't go above 33% because then there's a takeover for everybody. So you see our net cash invested goes from $1 billion in 2024, $600 million, $500 million because of the buybacks and the market value just gone the other way. Here, it shows total return in euro dollars of $4 billion. It's really unrealized, but at the best return we've ever made in terms of amounts. We've got a 15% compounded but it's $4 billion. Poseidon sale, we've talked about it, been phenomenal. David has done an outstanding job. I just highlighted some of the key parameters, which we've given in our annual report. It's quite amazing what leadership, great leadership does, and we are fortunate to have been a shareholder with David. This every year, we talk about business can be a force for good. And over 40 years have seen that. Cumulative premiums of $300 billion, if you add it all up, $324 billion, net claims of $163 billion, that's -- we've given our clients, customers $163 billion that helps them in any losses that they've had. The salaries $2.9 billion is a company that had total sales of $10 million in 1985. $2.9 billion to all our employees for the families, made cumulative donations, $570 million since we began our donations program. We pay about USD 90 million every year across the system and pay taxes, I forget sometimes we pay taxes, $8.3 billion of taxes since inception cumulative to do business, grew our book value per share 18.7%. Our share -- our stock price $19.5, and we developed a strong and friendly culture, which is our key key plus the moat. And final slide next decade, we're always talking about the next 10 years. Guiding principles are there. Our performance, we're happy with demonstrated strengths that you've seen that Peter highlighted. And most importantly, we're well positioned for the future, much bigger company able to take big catastrophe losses, $1 billion, $1.5 billion, still have a combined ratio of 95%, terrific reserving by all our companies. And but the key fair and friendly Fairfax culture. So thank you for listening, and I'm going to open it up for questions.

Okay. So we'll get to questions here for Peter and myself, we'll have 1, 2, 3, 4 and 5, and please leave if you have to no problem at all, you can leave at any time. And this is -- this meeting is for our shareholders. So we're happy to answer any questions that you might have. So 1, 2, 3, 4, and then it goes to Jeff [indiscernible] for #5. So we start with #1.

Good morning. My name is Daniel Goche from Ottawa. I'm a recent Fairfax company shareholder in Fairfax India as well and Helios Fairfax Partners so the Fairfax Trifecta. Thank you, Prem and Peter for a great presentation. Congratulations on a phenomenal 40 years and having the best year once again in Fairfax's history. I would like to make the most of this opportunity to ask you a three-part question. What are you most grateful about in your company track record as you mentioned, your shareholder letter in your presentation, the fact that booked value and share price have historically compounded close to 20% annually, which is phenomenal, sitting on -- and long-term shareholders are sitting on a gain of around 800x since your IPO. The fact that an employee earning $40,000 per year who had participated fully near share employee purchase program would have accumulated more than 4,000 shares of Fairfax worth $10.7 million at the end of 2025 or the fact that since you began your donations program, you have made donations totaling more than $0.5 billion to numerous charity supporting communities worldwide. You are blessed and you're blessing others, well done indeed. The second part of my question is regarding your investment strategy. You said that you'd like to buy $1 for $0.50 as a value investor, and the shares of Helios Fairfax Partners formerly Fairfax Africa are currently trading below 50% of book value. Have you considered for capital deployment purposes to increase your ownership in the Helios? And you've said in your shareholder letter that Eurobank is by far the best investment you've had in 40 years. Kindly, can you please tell us about -- a little bit more about your investment strategy, how you can find and invest in the next Eurobank. And finally, during my younger years, I had the privilege of serving on the Board of Directors of the Writing Association, of former Prime Minister, Paul Martin. So I'm compelled to ask you this political question on political economy. Where or which countries are you the most bullish on the current economic prospects and investment opportunities? Here at home with Prime Minister Carney, former Central banker, who recently achieved a majority government this weekend, is committed to spending billions of dollars for building Canada stronger or in the United States with President Donald Trump ushering in a golden age or under Prime Minister Modi with the growing prosperity and economic growth in India or perhaps another region or country in the world that you would like to share?

Daniel, thank you, you've given us enough question to last the whole meeting. First of all, a warm welcome to our shareholder meeting and to become a shareholder. Your first question, what really makes me grateful. We wanted to be begin by wanting to build a good company. Ricky Salsberg who's now with the Good Lord, we wanted to build a good company, that's what we are focused on. After 40 years, I'm biased, I think we have a very good company, and we have a great culture. All of these people will talk about that culture with you as and when you have a moment, we've got a terrific culture across all our companies. And that's what I'm really grateful for. Peter, would you add to that? Anything that you want to add? .

No, I think that's -- that sums it up. The culture, the return, it all comes together and...

And all the other things that you added about the return, but the culture is very important. And the culture is the moat. That's why after I'm gone, Peter is going to be taking over, it will continue. And it's all within all our presidents have the same opinion of culture. I said last -- yesterday, at dinner time when I said to our shareholders that people want to be good people. And they don't want to fire people that are friends and they're sensitive to people and their jobs and their families and so, and we found that. And you can do that and still get 19.5% compounded over 40 years. right? You can be a good company, a good citizen of the world. Second thing that you said with the investments, Helios, we look at all of that. Helios is run by two terrific guys [indiscernible] at Babar and we are a big friend of them, and we'll consider all the possibilities. The third one, Eurobank. The third one is very interesting, and I think it's -- I'll ask you answer your fourth one, and then I'm going to ask to [indiscernible] talk about Eurobank. We have them here, and so we'll ask him to say a few words. But on when I travel, like I'm 75, going to be 76, have traveled a whole bunch of places. Business-friendly policies work. And Countries Greece was very socialistic and then the Prime Minister who is now serving a second term became business-friendly and Greece is flying. right? Good example. India was socialistic for 67 years, 67 years killed a country. That's one of the reasons I asked me to come to Canada, in 1972. But so we have to be worried about socialism and we have to be worried about giving before we earn. So our book is called doing good by doing well, you're going to do well. Like how do we give $90 million for charity if we -- the whole company never made $1 million. You make $4.8 billion, you can give $90 million. So we're very focused on that. I'm a big believer in free enterprise, lack of regulation, Daniel, lack of put the taxes down, give people the freedom. We have the [indiscernible] we celebrated our success, and Canada has got tons of success from very humble beginnings, have gone to the United States, on the weekend for [indiscernible] in the United States so inspiring to see so many people who've done well come from very humble beginnings. And so I look at -- and in Canada and the United States they have gone together for 200 years. They been friends, brothers, sisters all working together. 60% of our business is in the U.S. We've got some of the finest people working in the United States in our company. And so we think all of these that will -- differences will get sorted out over time. And in fact, Mr. [indiscernible] said a long time ago, 50 years ago, 40 years ago, we were so frightened about what was happening -- and there were so many bad things that were happening. He said, and he thought we wouldn't survive and long behold now we're like 40 years since that time. So these things will change. This too will pass that expression. And coming to Canada, I'm a big fan of Canada. We created a -- Canada has got a wonderful country, but we did create a [indiscernible] University, we created a center for free enterprise, and we really want to push free enterprise across Canada. Education, pods showing how people have come from nothing. And we've got about 35, 36 members on the way to 100 members because you have to hear and see about the journey. So we're going to do that. It opens in May. But let me just ask [indiscernible], why don't you give us a little -- he's talked about his strategy for 3 -- he's got a strategy for 3 years. He's laid it out publicly. And -- but give them a nice round of applause. We've done a fantastic...

Thank you all, and thank you, Prem, and let me also thank you for your statement that Eurobank has been by far the best investment that Fairfax had over 40 years. Obviously, this is a great honor but the big responsibility for everyone at Eurobank. It is true that we had some tough times, but thanks for the support of Fairfax your long-term commitment and all the initiatives at the management of Eurobank too, we got really positive results. And indeed, 2025 marked another strong year for Eurobank. If you remember, last year at this annual meeting, I said that we commit on return on equity of about 15%. Actually, last year, we delivered instead of 15%, closed EUR 1.4 billion bottom line. Earnings per share of EUR 0.37. And we are paying a cash dividend, which is increased versus last year by 13%, and we're about to approve a new share buyback program close to EUR 300 million. At the same time, we are further enhancing the business model of the group. We source about 50% of our revenues out of Greece, 35% out of Cyprus, 15% in Bulgaria. Our banking segment is experiencing a very strong growth with loans increasing by more than 12% in 2025. The Wealth Management business is also advancing quite well, evidenced by 30% increase in assets under management, and also our footprint in Life Insurance is increasing, thanks to the acquisitions that we have done in Cyprus, we acquired the largest insurance there, and also the acquisition of the Life Component of EuroLife in Greece, which is enhancing further our footprint in this country. Now as you said, we recently presented our 3-year plan for the year's '26, '27, '28, in which we anticipate a further increase of our return on equity to 17% by 2028. Earnings per share growth about 10% per annum on average for the 3-year period. And we anticipate to distribute to our shareholders more than 55% of our earnings through cash dividend and also share buybacks. So overall, and without underestimating the fact that we live in a very volatile world. We may experience one of the most serious energy crisis of the last decade. I remain very optimistic about the growth prospects of Eurobank across our three countries: Greece, Cyprus and Bulgaria and across all our business segments. And one last point that I would like to share with you. Eurobank is actively promoting the concept, the idea that Greece and, to a greater extent, Cyprus, may act as strategic ways for Indian companies that would like to expand their businesses, their products, their services across the EU. So in this context, the in the office of Eurobank is scheduled to be inaugurated in about 1 month from today in the presence of the President of the Republic of Cyprus. We spend an official visit to India around that time. And this event is going to receive a number of business announcements for which I would like to thank Fairfax for help and especially Fairfax Digital, the Chairman and the CEO of Fairfax Digital, my friend [indiscernible]. Thank you for that. And thank you for all the support to this journey.

Thank you very much [indiscernible]. Great performance. Number two, if you don't mind.

Good morning, Mr. Chairman. Thank you so much for being a capitalist with compassion and showing us all how it's done when capitalism gets a really bad rep. My name is Ashwin [indiscernible] and I come from Waterloo. My question is about the elephant in the room, AI. What is Fairfax AI strategy? I understand it's a [indiscernible] life company. But -- how is it going to affect Fairfax's and customers? How is it going to affect the business itself? How is it going to affect our shareholders? And the broader question is, I use AI every day, and I see the capabilities of this technology. It seems straight out of Sci-Fi. I'm concerned that a lot of people might lose jobs, and this is going to affect the overall economy and society stability even. So where do you think all of this is going to go

So that's a really good question. Let's speak into the one person doesn't know too much about technology. But I do use AI and having lived for a long time, and we had the Internet and when it came and there was also predictions made and ultimately, the economy somehow generates job. So I don't see a major -- if a job is -- you lose a job here, you get another job elsewhere. But we'll answer that question when Brian Young talks about our Insurance business. We'll -- he'll tell you how we are approaching AI. So thank you very much for your question, and welcome for our meeting. Number 3?

Akash from London, England. I found Fairfax only 2 years ago, unfortunately, like a lot more here, I've owned it for much longer, but they are better late than never. And -- but it gave me the opportunity to read your shareholder letters for the last few decades, 25 years in a row like a book. And I fell in love with Fairfax, and your exclamation marks.

The only thing that Rick Salsberg couldn't take out exclamation mark every day.

They were lovely. And it was a great experience and gave me a lot of conviction about the future. My question was actually going to be about AI. So now I have to think of something on the fly. But I was with talking to the team members yesterday, and it was about the TRS. And the question was, when you with the TRS versus the buyback, how would you think of when you closed the TRS, would you think of buying it back? Or would you close it down just by selling it?

We look at all options. But Peter, you have looked at the TRS. Why don't you give them a little -- Peter is right on top of all of that stuff.

Yes, the TRS, really, we treat it as an investment back a number of years ago, we bought approximately, I think, 2 million shares. We've taken a bit of the TRS off. It's 1.8 million shares today. But we're always evaluating it comes into -- when we look at our capital and we've been buying back our shares, like I said, bought back outright about 1 million shares last year, just over $1.6 billion. And as long as we keep thinking -- we think the Fairfax shares that are undervalued, they'll do well. We'll continue to hold our TRS. As it goes up, we'll take some off for exposure purposes, but we treat it like one of our other investments essentially.

Akash, one advantage we have is the TRS as Peter was saying, we can acquire them. We have some time. But we can use our money to go and buy shares in a marketplace where there's no option right, we're going to buy them. So he looks at both of those things before we -- as you said. So thank you very much, Akash. Number 4?

Good morning, Peter, and Prem. Charles Fisher from Seattle.

Nice to see you, Charles. Always good to see you.

Thank you, Prem. I wanted to thank you both organization for just what's become a fantastic week in Toronto. People are coming now on Sunday, Monday, there's great meetings. You guys organized lovely meetings. It's a fantastic week, the best week in North America as far as I'm concerned for any shareholder meeting.

I've been paying you, Charles.

I do have a concession to make, Prem. I'm cheating on you. Fairfax is only my second largest holding. I have another holding in a big spectrum company called NextNav which will have a resolution shortly, and I promise to put a chunk of those proceeds into Fairfax to make it fully my largest position. I also have gotten to know the folks at [indiscernible], Adam and his Kids Connor and Reily very well. And I really like them very much, and I was wondering if you had some comments that you'd like to make [indiscernible].

So [indiscernible] is run by Adam [indiscernible], Strathcona is the first investment that he made. And approximately $100 million that we put in. We've got that back in a dividend. He paid us a $10 dividend. We've got that back. And the [indiscernible] position is worth about $400 million. So we got our capital back and its $400 million, is now working on Green Fire. We've -- we're investing with them, just happened. And Adam's annual report on [indiscernible] for [indiscernible] company one of the best annual reports I've read about the oil business. I recommend all of you reading it, and I recommend Strathcona and GreenFire for the long-term investors. So thank you. Thank you very much. So we go on to number 5. Jeff

Peter. Our first question is about the current insurance environment. The question is as follows. Fairfax had record underwriting profits in 2025 of $1.8 billion and achieved its objective of $1.5 billion. You commented, however, in your shareholder letter, the insurance pricing is beginning to soften. I would appreciate hearing any additional comments you might have about the current insurance underwriting environment. And specifically, do you think that Fairfax can still achieve its $1.5 billion underwriting profit target in a soft insurance market

So thank you, Jeff. And usually, Peter will answer this, but we do have Andy Barnard and Brian Young and Lu and Silvy.So we'll ask them that. And as Andy makes his way up to speak, let me just say that yesterday, I said people ask me, what is the biggest -- best acquisition you've made? And I say the best one is Macau, the first one because otherwise, you're not in the game. And so I mentioned that and I said the second best was a company, a small little company called Skandia. And why? Because I had to get someone to run Scandia, and I went to New York three times and to get Andy Bernard and [indiscernible] time he said, "You got to be kidding me. He said, first dinner, I'm not going to leave this transatlantic to come and join a run-off company called Scandia. That's how it began. Second and third, and ultimately, we were fortunate to get him 30 years ago, and he's had a huge impact on Fairfax. In 2011 I said to him, as I told -- of you know, to all of the insurance company reports to him. And I think he came here and said, at that time, almost, what, 15 years ago said that he would hope that the insurance business will have the same reputation of being fantastic like the investment business that we want. And the investment business did a little less well, and the insurance business has done fabulously well. Andy, over to you. Come on in.

Thank you very much, Brent, for all of that. I'm going to let Brian and the others talk about our sort of our position, the market, our prospects. I thought -- as Prem mentioned, I've been in this role now for 15 years, and I thought I'd just give a little brief broad perspective on how I look back on that. And so I divide that 15 years, which started in 2011 into two periods. First, 2011 up to 2019. And I really look back in some of this benefit of hindsight, of course, this was a period of preparation. We added during that period, Allied World and Brit too very powerful new platforms capabilities that really build out our suite of products. We had Allied, we had Crum & Forrester, bolstering its capabilities. We had a few small acquisitions. We added to what Crum we're capable of. Northbridge earlier on in that time. It finished its integration, which really positioned it as a much stronger company. And of course, during this time, Odyssey and Zenith flourished during most of that time, a few tough years at the beginning for Zenith, but over the course of time, the -- both those companies were doing very well. And then, of course, we built out that International operation during the latter part of that first period. As Peter mentioned, how significant that has become and what we think that's going to do for us in the future. So this was really a period of preparation that brought us up to -- when we get to 2020 across Fairfax across our companies, we now had in place excellent leaders leaders that are fully aligned with Fairfax culture, then body the trust, the transparency, the talent that without which our decentralized system could not function. And so all that's in place as we roll into 2020, of course, the big thing at the start of the year was the pandemic. A lot of companies heading for the hills, a lot of uncertainty. Plus we had a very attractive hard market. that had already been underway and was gathering for us and I think the pandemic just accelerated. So we were at that time in just a unique position because of our structure, our capability, our leadership to thrive and thrive, we did. Over the next years, as we go into the second period, 2020 up through 2025. Peter talked about some of this, he's going back to 2017. But if I look from 2020, we virtually doubled our premium volume, and almost all of that was organic with the one exception of GIG, but the vast majority of that growth was all organic, driven by our companies by their leaderships, by their management teams. And more importantly than that, our underwriting profit over that period more than quadrupled. And so this is where we really came into our heyday. Today, to 2026, we're recognized as an underwriting powerhouse in the industry by the marketplace, by the rating agencies, we had huge increases in our ratings over the last year, 1.5 years. And so we've really -- again, looking back on it all over that 15 years with the benefit of hindsight, we just positioned ourselves so favorably to really take off when the market conditions were supportive of that strategy. So I believe that what we built is -- is built to last. It is built to withstand the pressures of the market cycle that those who follow the industry, you know that we're in a softening cycle, things become more challenging, but we're very confident about our capabilities about our management abilities to navigate through some more challenging times and to sustain superior performance as we go off into the future from here. So I personally -- I've been in this industry now for close to 50 years. I've been at Fairfax for 30 years. I'm not going anywhere quite yet. However, my good friend and partner of the last 36 years, Brian Young, is taking on a larger and larger share of the oversight responsibilities in Fairfax. Those of you who have followed Odyssey, particularly from the time, Brian took the helm in 2011. It's very clear that Brian is someone that knows how to make money in this business. And so I think our future is very, very bright as we move forward from here. So let me turn the microphone over to my friend, Brian Young.

Thank you, Andy. I learned some big news a few minutes ago. Andy told me that he is going to be a grandfather for the third time. So big hand, Andy. But I will cover the AI question and the current market environment, our ability to generate an underwriting profit in the current environment. But first, just highlights for 2025, as Peter mentioned, actually $1.82 billion of underwriting profit in 2025, fractionally higher than $1.79 billion in 2024. Combined ratio of 93%. Embedded in that was 4.8 points of CAT loss the $1.2 billion that Peter mentioned, the biggest being the California wildfires in Q1. Within the 93%, we benefited from 2.9 points of favorable reserve development. And it's important to note that Fairfax has had 19 consecutive years of favorable reserve development for the last 2 decades. Our reserves have been a store of value. And as you all know, we are really focused. All of our companies are focused on disciplined underwriting and strong reserving, prudent reserving is really foundational to disciplined underwriting. Most of our -- we have more than 30 operating companies. Nearly all of them equal or exceeded expectations from an underwriting perspective in 2025. The small number that didn't we weren't expecting them to make underwriting profits given the market circumstances that they faced. So there were no negative surprises in really any of our companies I'd like to highlight a few standout performers, focused first on the big companies, and let's start with the recent -- the most recent recipient of the Athapan Award, Allied World, our largest company generating record underwriting profits of $546 million, a fantastic result. Congratulations, Lou and to the team, and I'm going to let Lou come up and tell us what the secret sauce is that's made Allied so successful. The second company I'd like to highlight, last year's recipient of the Athapan Award Northbridge. Silvy and team delivered the lowest combined ratio, 88.3% of all our big companies in the last 4 out of 5 years, Northbridge has delivered a combined ratio below 90%. And Silvy will come up after Lou and give us an update on Northbridge. Turning to the international side. We generated $220 million of underwriting profit, more than double that we generated in 2024, standout performers [indiscernible] bright Singapore Re, all generated record underwriting profits. Singapore Re, headed by [ Philippe Mellier ], had not only the lowest combined ratio on the international side, they had the lowest combined ratio of all of our companies at 77%, well done Philippe. Our premium $33.3 billion, it's slowing down. The market is getting more challenging, no doubt. And we have to exercise more discipline. We have to be more selective in the risks that we take. We have to focus on our line size deployment. But we still think there's opportunity out there in the market. The sectors of the business that are under the most pressure are the ones that have generated the most profit. So yes, the margins are shrinking, but we still think their margins and when the margins are not there when that margin of safety we need to take on the volatility of insurance, then we're going to scale back. There's no pressure on any of our companies to write for profit. And I've experienced that at Odyssey working there for 28 years, leading it from 14 never did I or any of our people have any pressure to write for top line. On the question of AI, it's important in our decentralized structure, innovation comes from the ground. It can't be forced from the top down. And we've got 30-plus wonderful businesses. Everyone is focused. AI may well be very transformative, and we're -- we want to be -- we're not at the cutting edge, and we don't really want to be in the cutting edge. I mean we're where we think we need to be in the pack with the rest of the insurance industry. But to understand and take advantage of the innovative things that we're doing at the company level, we formed an AI working group, across the Fairfax organization, and we have more than 75 people participating in the working group, we have more than 100 use cases that we've developed. We have a SharePoint site. So if we develop a use case in a company in a certain part of the world, we can share that with the other companies through the forum through the SharePoint site. In terms of the AI use cases, most of them have really been focused on improving process, doing things faster and smarter trying to underwrite more business efficiently through the use of AI, using AI to inform our underwriting decisions. So really, I would say if you were to look at it, and Mark [indiscernible] used the phrase I think it's great does AI bang the cash register, does it lower your loss ratio, does it lower your expense ratio? I would say right now it really focuses more on -- we're not banging the cash register yet as yet other than the fact with AI, we are able to underwrite more business using the tool than previously. But lowering the loss ratio, lowering the expense ratio in terms of the AI tools that we're using, that's really the focus. And I think lastly, it's really important to say, and Prem has emphasized it ad nauseam that AI will not cost us any jobs. We don't believe in laying off employees period. And that includes AI. It may result if AI allows us to operate more efficiently then maybe the rate of growth in our employee count will slow down, which will help the expense ratio. But it won't come at the expense of people. Thank you. Maybe now I can turn it over to Lou.

Thank you, Brian. Great to see everybody. It's good to see so many of you, only get to see once a year and talk about our businesses here at Fairfax and at Allied. And it's also not every day that I feel like Allied World has won the Stanley Cup. So we're really proud of that as well. Brian mentioned our underwriting profit. We did have a record year last year on underwriting profit. We also had a high watermark on our net income. And I just want -- I want to recognize the investment group at Fairfax, who does a tremendous job on our portfolio. Having that type of net income really helps our cash flow and everything else. So it's really, really good to see. So we grew our company to $7.4 billion last year. And Brian talked about the market a bit. It is softening some. I would say it's very -- getting a little bit more price competitive. But for those of you who've been with our industry for a long time, it's not a traditional soft market. We're not bottoming out, right? So terms and conditions are holding pretty well. Combined ratios don't have so much pressure on them, still manage the profitability. And so when you look at that, you say, well, there are opportunities around the world to be able to get some growth right? So we're not giving up on that because I think there are certainly some opportunities. So what I wanted to talk about just for a couple of minutes is what are some of the things that we do to help us manage the cycle, right? Because we feel like we've built a company that could perform in all segments of the cycle. And in order for that to happen, we have to execute on many strategies every single day. Right? So the company has to be structured in a way to give us that ability. So there are a couple of things in there. And I think the first thing to talk about is the structure of having a very flat organization. And I think you see that elsewhere in Fairfax, but at Allied, we have a very flat organization. We don't have many layers. So strategies and communication moves quickly. This gives us the opportunity to move fast in different marketplaces around the world. So as the markets change, we can change strategies. We can execute on those strategies. Our underwriters are at the desk since there's not lots of layers. They don't have to get multiple sign-offs to do their job to able to make a decision. We run with the mantra of hire really great people. give them the authority and accountability to be able to get the job done. Now additionally, we have over 40 products. We are in 29 offices around the world, and that's growing. We're expanding our presence around the world geographically, which really gives us lots of diversity. And so the product diversity that we have, and we're also -- we're in 11 countries, and we're in 4 continents. So the earnings stream is very diverse. And when we have that type of diverse earnings stream it really limits earnings volatility. So when the market starts to get a little bit tougher, it's really helpful to have different earnings streams because you may have to slow some down, right? If you're not getting the marketplace that you like in a certain product or a certain country, you're going to have to slow that down, but maybe there's an opportunity someplace else. So the diverse earnings stream is really very helpful. And I think you see that throughout Fairfax as well. The third thing that I would touch on is underwriting discipline, right? Underwriting discipline helps in every marketplace, whether it's a hard market, soft market in the middle. It's extremely important. It runs through every Fairfax company. It's part of the culture of Fairfax. So our underwriters -- now what does that mean really? Our underwriters understand rate adequacy, they understand when they're negotiating a deal, where that rate crosses the line to not being enough for the exposure that they're taking on. When we run into that situation, we have the ability to say no, which we say no a lot more than we say yes. But what we really prefer to do is to say, "No, we don't like the deal that way, but we do like it this other way, right? And we'll put a proposal out that works for us, and we hope works for the client. And we've been able to do business like that and sell deals like that fairly often, even in this marketplace when things are getting just a little bit softer. So that's been very helpful. Now nothing works without great people. And every year, I come up here, and I think I talk about how great the people are at Ally. We've had people with us for a very long period of time. They've seen all different cycles, so they understand how to manage in the different cycles and through the different cycles. And we have a very low attrition rate at the company. So our people are really the key to making all the strategies work. And so for us, we're going to continue to do the things that we're good at. As the markets soften some, we're going to limit our mistakes so that when the market does get to a better place, we could do all the things that Andy talked about that we did a couple of years ago and not have any distractions. So thank you very much, everybody. Have a great day.

Thank you, low. Good morning, everyone. First, I'll start with a little concession to Lou. Northbridge employees wanted to do a Rory [indiscernible] macro repeat, but we are happy that Allied World has won the cup this year. So a little perspective on Canada, just sort of Northbridge Financial represents the Canadian insurance operations for Fairfax. $3.4 billion in revenue, and we're the third largest commercial insurer in Canada. We have a very good position, maybe a smaller fish at the Fairfax but a bigger fish in this country. So what happens -- so market conditions? What happened in '25, as Lou said, the price competition really started to ramp up. And we're starting to see competitors trying to buy business. And sorry, I apologize for being a broken record, but once again, we are not pressured to write premium at a loss. And so with that in 2025, our employees did the right thing. They remained disciplined, not only in underwriting but claims and expense management. But equally important is we doubled down on really focusing on customer loyalty customer service and customer safety. So not only are there when things go wrong, but we're trying to help our customers have a safer operations. And so with that, we did not grow in 2025. However, we have our record year, as Brian noted. So with that, 2026, it looks like the price competition continues and we will manage accordingly. And along with just being disciplined, we're also looking at building areas where we can grow when it's the right time to grow, for instance, increasing our lines on renewable energy in Canada. So just manage the market and then be ready to go when it's time. And just one little comment. We talked about the culture and of course, many times and the beautiful word of being empowered not just at the president level, but throughout the company. And I just wanted to share with you that our employees are like you, they're shareholders. Over 70% of our employees at Northbridge are shareholders. So not only are they empowered but they're owners in doing the right thing. Thank you.

Thank you very much Silvy. Peter, anything to add, final words on the insurance industry.

Sure. Just two quick things, Prem. And I mentioned in my remarks that we write $33 billion of premium across the world and that grew by 2.3% this year. But I was looking at it, and it's interesting when you look at the international operations and how we benefit from diversification scale, is bright in South Africa. They grew 20% this year. Colonade 18%, Asia was up 15% and Polish Re was up 15%. And -- so even though North America rates are coming down, we're maybe not growing as much, we have all these opportunities around the world. And then just secondly, I just have to comment that we have 2 cups in Fairfax One is the Mr. Athapan Cup. And we also have a hockey game between the Fairfax head office and the Allied Group, and unfortunately, now Allied owns both cups for this year and I have to say it did come into the evaluation process a bit, but we left that aside.

And I happen to be the coach of the hockey team and the holding company. We're coming out to you. Okay. So we go on to number one.

Yes. Hello. My name is Angela, I just finished my HBA to your IVY, and I wanted to extend appreciation to Prem for all the support you offer institution and with the values [indiscernible]. My question is simple. I was wondering if you could speak a little more closely about specific metrics or benchmarks used to hedge against climate-related underwriting exposure?

Peter, you want to add that question, Peter?

Sure. No. As we said before, obviously, insurance, we protect people against catastrophes and we write a lot of catastrophe business, and climate is a big part of that. So for us, that's what we view as a service we provide our clients, and we take that very seriously. But -- the other side of that is we have to manage our exposures. And I think we talk about that a lot. We have a lot of internal limits we have. We ensure that each 1 of our companies manage their catastrophe exposure within the capital that they have at their level. And they look at total limits exposed. They look at PMLs. They work with their clients to reduce exposure. And then we protect ourselves through reinsurance. But bottom line is we manage it at the company level. We aggregated at the Fairfax level. That's one thing we do do. We look at our total exposure Today, when we look at -- we look at it like a one in 250 PML, so that's every 1 in 250 years, what would be your expected loss. Today, that's around $3.4 billion, $3.5 billion, well within our $4 billion. That was never in the past, would we say our 1 in 250 was manageable within our net earnings. Today and especially over the last number of years, it is. So we're quite comfortable with that. And but it's a very important product that we offer to our clients, and we take it very seriously. Thank you for your question.

Thank you for your question, Angela. And just to add to what he says, there's limits in our business. So we -- mainly our exposure comes from reinsurance and we look at those limits, and we make sure that as Peter was saying, within 15% of the company's shareholders' equity capital. And never forget there's always price. The price of property exposure now cats coming down. But when the price is up, that takes all of those possibilities into account, and that's when we expand that we have expanded in the past. So price and limits. But thank you for your question, number two.

I'm Paul Durnan from Burlington. I read in the Globe Mail today, an article that disturbed me, Bombardier Recreational Products is taking a $500 million write-down on tariffs, steel, aluminum, copper, and revised totally their 2027 outlook and the stock price went down quite sharply. Maybe you can't look forward to precise numbers, but I'm scared based on that one alone. How is the future going to unfold for this whole country?

Well, those tariffs are important. And we've got two companies. We've got Sleep Country, 40% market share, mattresses across Canada, 40% market share. And they are getting a lot of stuff from all over the world. But they've been able to get some concessions from the suppliers, some they pass on. They had record profits in 2025. And lot of tariffs. And another one is [indiscernible] Skates, which is skates and Hockey skates, have 50% market share across the world in that case, and we get, again, all sorts of purchases from different countries, tariffs, but they will get supply concessions and pass on some of the costs, and long story short record profits in Bauer. So you're able to navigate as a business -- that doesn't stand still and say the tariffs have gone up. Whoa its May. No, you negotiate, you figure out what happens. And that's happening and I speak to a lot of companies in Canada. A lot of companies have done that the same thing. And we are able to face those tariffs and succeed. You want to add?

Yes. Like okay, I'm not -- do you want -- I want to stretch this out to be broader than just the companies that you are involved in, generally, all across Canada, I'm concerned about this matter.

No, I think it's a good concern. But the people I talk to who run companies, they've faced these situations before. There's all sorts of hurdles that you face in business. COVID, imagine COVID business stopped, you couldn't -- our sales went to zero in many industries, and you have to survive that. And so these are things that companies have to work out we're just one example of that. But your concern is valid. And thank you for bringing it to our attention. Number 3?

Prem, it's Jason from Thunder Bay, Peter Hi, as well. I have to admit, I'm a bit sleepy this morning. Part of that because Brian Bradstreet was with us until 11:00 p.m. after the dinner yesterday. And he was mostly talking about his views on currency debasement, really foreseeing that politicians will continue to inflate away debt to GDP in the U.S. is now past the peak of World War II. So maybe you could just give us some color on how you see the massive debts every Western government has right now, how we get out of it and gold as well?

Well, that's one of the reasons we're not gold box, but one of the reasons people like gold, the fact that currency debasement taking place. We really don't have much to add on that. The fact is there's a huge amount of debt. The fact is that the United States has $2 trillion to -- the deficit is about 6% of GDP, huge. But they've got a whole bunch of revenue coming in with the tariffs that most of us don't like, but there's tariffs coming in. And so we have to wait and see what happens. There's two major problems. One is the markets are high. I talked about NVIDIA. NVIDIA had last night at our shareholders and NVIDIA had net income 3 years ago of $8 billion. That's $8 billion, 3 years ago. 2025, something like $117 billion, like massive net income, that's not revenue. And then it sells at about 33x whatever types of earnings, right? So a huge PE on earnings that have skyrocketed. This happened before. It's happened with the -- in the 2000s with the digital stuff that came in with the network Internet companies. And for history's sake, Microsoft was $60 in 2003 years later, it was down 75%. We couldn't see it. High PE, all of the things that happened here. And then if you go further back, you the [indiscernible] same sort of thing. So you have one risk as the markets are high. There's lots of individuals in the stock market your friends are all in the stock market. They're buying stock, they are trading stock, they're buying options. They're trying to make money in the short term. The other side is the potential that the United States will be very strong potential, that, that productivity is going to be very high, that the deficits are going to come down. For example, if the economy in the United States, I think the -- all the projections are based on 1.5% economic growth for 10 years. But if it goes when 1% more, that eliminates the deficit, that's how sensitive it is. If the GDP grows by 1% more, so instead of 1.5% goes to 2.5% the deficit goes. So lots of pluses and minuses. The bottom line that you have to be cautious, very careful, which is what we are careful, careful, careful because the war in Iran anything can happen. So that's how we're looking at it being very cautious. We've got government bonds 3 to 4 years, not 10 years, 3 or 4 years. And any of us talking investments are very well financed and very strong. But your concerns are well taken. And Brian [indiscernible] been with us for 50 years. And he is someone you should listen to. So thank you for your question, and we go on to #4.

My name is Ernest Wang from Toronto. I'm a relatively new shareholder. So looking forward to learn more about the culture as I become a longer-term shareholder. I wanted to ask the AI question from an insurance perspective. Fairfax is a meaningful underwriter of cyber insurance. And as we are seeing with developments in AI, such as Mythos last week, -- we are really in unchartered territories. So how is Fairfax -- how are these types of events in AI in general changing the wafer fax looks at its cyber exposure in the underwriting business?

And you heard Brian talk about it. Cyber is a great example. When we were expanding, the price was way many, many people didn't want to write the business. And we had about 3 or 4 companies [indiscernible] it and and we did very well. But now the competition is coming in, prices are coming down, and we've got less exposure. But we're very sensitive about that. Peter, you want to add to it?

Yes. And we have exposure to that in two ways where we have the exposure on ourselves being attacked. And we're doing a lot of work on that as well right for us the group that we're ensuring that we have best practices in place, 24 hours surveillance, et cetera, et cetera. So that's a real focus of Fairfax, and then we do right cyber, as Prem said, it's come down the last number of years, and all of our companies are working on it. They manage it through limits, through reinsurance and exclusions. So as AI progresses, it's coming quickly, but rest assured, they're working on it. And it's an industry issue, and they're on top of it.

And I have a second question. You highlighted that Fairfax's private credit exposure was quite limited. Do you view this as -- however, many other insurance companies have invested heavily into private credit -- so do you view this as a potential issue going down the road?

Definitely do. Anything that is everybody tries -- private credit has gone through the roof. Most of this private credit is for PE firms. So a private equity firm buys a company leverages maybe 7x, 8x to equity. And then send something else to private credit. Private credit that has finance this. It's not financing a company like ours, for example, right? So there's a lot of risk and the ratings are from companies that are very new and perhaps not -- you don't get S&P rating this stuff. And so I've seen it before, private credit, private equity, all of those you have to be careful about. And it's another risk in the marketplace, private credit. And these risks as such, like we saw in the mortgage business, they can -- it's like a fire, they go right through. So we stay away from that. And basically, we -- outside private credit, we have no exposure. Most of our -- I told you, government bonds. Spreads are very narrow. So it's government bonds. And if you have any bonds that are corporate bonds, it's 1 or 2 years of duration, very good credit, that we are sure we'll get up. Bonds because if interest rates go up and you have corporate bonds that you can come down. So this is another thing that could affect the life insurance companies, particularly but also property casualty companies. And all of these are possibilities that could change the market. The market is going down right now, property casualty market. But if the capital shrinks because they've got private credit or something else, and their capital shrinks, then of course, the market can turn. And for us right now, as Brian has said and Andy have said, we got to be very careful, and that's what we are very disciplined. So thank you for the question. Jeff, number 5?

Next question is about capital allocation. Can you discuss the decision process for determining the size of the annual dividend versus making stock repurchases or holding the capital for other purposes?

Yes. So that's a good question. I mean it's -- we don't have any formula. We give a dividend which I know for a lot of our shareholders is taxable. And it used to be $1 went to $2, $5 and $10, and now it's $15, is less than 10% of our net income, and we are comfortable with that, less than 10%. And -- but our number -- financial [indiscernible] like Peter said, financial soundness is #1. We are focused on that, particularly for some of the things that might happen in the economy. But after that, we want to buy back our shares. And it's if you look at the float of our company, our gross premium and you look at the 40 years and the growth in our premium might be if you look at the growth in up here, it might be -- is in the annual report, but 15%, 16%, 17%. And in the last 5 years, it might be only 10% or 12%. But then you look at growth per share in gross premiums per share, the fact that we've dropped the shares that Peter was saying, it's pretty close, like per share growth in the float or gross premium certainly goes up to very close to the absolute gross premium growth or the float. And that's what per share does. And we're very focused on per share float and growth in premiums and all of the other things, per shares, not the absolute number doesn't count, it's per share. That's what will affect your share price over time. So that's what we look at. And then we look at there. The other things that come, Jeff are ones that we don't forecast. I just cover the log. After 40 years, companies want to be partners with us. They're looking to be partners with us. And you won't believe the number of opportunities we get. And quite often, we have to say no, because the price is high or whatever. But we get some very good opportunities to partner with good companies, and that's a big advantage. That's what happens over time. Over 40 years, you get that. We've treated your partners well at behalf. So Jeff, thank you very much. Number one?

Good afternoon, Chair. So I was able to read The Fairfax Way by David Thomas, phenomenal book, would recommend it to anyone. Slightly disappointed that it's on sale now. I paid full price for the hard cover. I could have just bought the [indiscernible]. So I learned a lot about Fairfax from that book. And one of the things that was really special was that you were -- the book said you were really candid about Fairfax's price. You are open and honest about whether the company was undervalued, whether it was overvalued. And you're one of the best capital allocators in this country and maybe even in the world. So right now, what is the intrinsic value of Fairfax? And given all the market conditions, concerns about bubbles, like is Fairfax undervalued, fairly valued or overvalued? Basically, I'm trying to make some money here Mr. Chair.

And you want to do it in a week. No. So we give you all the information and then used to be book value is a great measure. But a lot of our things -- Peter talked about $4 billion, that's not our balance sheet. And a lot of our companies are worth a lot more than book value. The intrinsic value is much higher. But for 40 years, we've never told you what intrinsic value is. That's the work you've got to do and you compare us to everyone else. But the single biggest thing you can do as an investor is to invest in our company, if you want to, but take a long-term view. Don't look at it every 3 months, 6 months, 9 months go up and down, get excited and you want to sell some and then buys it. Look at it over the long term because compounding takes place over time. And that's the suggestion I'll make for you. But you've already had a good start reading Dave Thomas' book. So thank you for your question. Number two?

Mr. Watsa, my name is Jia. I am individual investor from Toronto. I am a long-term follower of Fairfax, but a recent shareholder. I have a question that might contradict with your annual letter. The company, BlackBerry, they've released earnings last week.

Are bringing me back to BlackBerry?

They released earnings last week, they're impressive. They're EBITDA positive. I know you don't like EBITDA but they're cash flow positive and they're buying back shares. And that's been a trend over the past 3 quarters as well. So my question is, do you think this could be yet another example of patients paying off for Fairfax perhaps we see a slide on BlackBerry in a few years.

I hope it is.

And I have a quick follow-up, and this is what related to the overall stats sector, we see a much more adjustment in the valuation metrics for the Software as a Service company. So -- and Mr. Watsa as a value investor, do you think now is the right time to start evaluating some of the opportunities in the space?

We looked at it and ourselves, we haven't bought any. But I think a lot of them have come down quite a bit. And so we'll consider -- we never talk about what we're going to buy, right? As you expect us not to. But we look at all the possibilities. And I gave you the example of Under Armour, $50 to $5, that got our attention I don't think that's happened yet in some of the companies you're talking about. But thank you for your question. Thank you. Number 3?

I'm Peter Stern from Toronto. One comment on AI. I've got a couple of decades in IT experience. And one thing, if we have any exposure to AI companies, we should pay attention to the intellectual property lawsuits that some of these AI companies are being exposed to, that's something that could become a big problem for these AI companies as I foresee it. My experience is too much garbage and garbage out with AI in my opinion. Now completely separate subject. The Middle East situation, how do you see that playing out? And the infrastructure that you run is bombing. What is our exposure there? And do you see any like opportunities as a result of a bad situation right now potentially getting better eventually, hopefully.

So that's a very good question. We have something called GIG and GIG Gulf. And in total, they are approximately $3 billion in premium. First worry for us was our people. And I'm happy to tell you, we've looked at all our people, and they're all safe. And we've -- with Ukraine, we had the experience of how to protect our people, and we protected them really well. That's point number one. Point number two, the company continues to do very well. Our losses are very small and far between, war risk is not covered. If that war [indiscernible] exclusions unless you have a specific exposure to war, then you get the premium. But all in all, we think been a very good position. Peter?

Yes. On the insurance side, really, the losses will come through the marine business, aviation, political risk. So we're going to have some losses on that, but we're not big players in those lines of business. And we're only -- we're 6 weeks into this war. So it's hard to tell where it goes from here. And -- but we're paying close attention to it. We'll monitor our risks. That's actually something we're really good at that when there's a risk out there as a group, we look at it, study it stays first, protect our cells, then is there any way that we can take advantage of it. As of right now, there'll be very little effect on our first quarter earnings.

Thank you very much. Number 4?

My name is Aryan, and I am from Toronto, relatively recent shareholder, but a long fan. Throughout this meeting and in general analysis of Fairfax, to me, it seems that the company's success is a product of both the company's structure in terms of both financial values, governance and the company's ability to execute well. As business landscapes evolve due to various factors like tariffs or AI or any other sorts of factors, how do you think about any potential change in decision-making processes at Fairfax? Would there ever be a set of circumstances where you would think that this company should take a more centralized approach or do you think the decentralized approach is one that should stay permanently?

That's a really good question because it's a 40-year. We've gone through all sorts of problems. And we think about that when we have faced a problem, one of our insurance companies used to be Markel Insurance company years ago, and we could easily have said, you know what, we're going to centralize. And we didn't -- and then we had the TIG with another big one. A big plus was we never changed the structure. All of these years, we've never changed the structure. And what you see is what Andy and Brian and all our company Presidents have said about the empowerment. Unbelievable how that works. And we -- last year, we had a thing on decentralization. We said, Andy, myself, Peter, we put it all together. And we said, sometime long after I'm gone, some bright wizard will come, perhaps like you, you're a young man and say, why don't you centralize all this? You'll save money here and you save $1 billion. That's what we could say. But what you lose is what you can't qualify. The culture between each company, the empowerment that they get, the fact that many of them will leave, and you see it in the insurance business and you see it in other companies. And so that, in our minds, will never change. That's why we put it in. So that 10 years from now, someone comes with that idea, where he says 2024 annual report. And the decentralization works, our principles will never change. And Peter, would you add to that?

First of all, I'm a huge fan of decentralization as well, and I see the benefits of it. But just as an example, if you go back to 2019, started the hard market, we were writing maybe $16 billion, $15 billion of premium. The hard market hit. And if we were writing as a group $16 billion, we wouldn't have been able to expand like we did. Over the next 3 to 4 years, we grew the premium by 16%, 17% per year because there was 26 companies writing $2 billion, $3 billion, $4 billion on the ground, nimble, ready to react and they were able to double their premium. If that was like one group at the holding company we wouldn't have done it. And I think over that time period, if you look at all the property casualty groups or companies we grew the most out of anyone and took advantage of that. So that's just one example. There's many, many others.

Thank you, Peter. Thank you very much. That is a very good question. We go to number 5?

The next question is about Fairfax's banking investments. With increasing exposure to banking through Eurobank, CIB and CSB Bank, can you comment about how you think about and manage banking sector risk?

Yes. So the credit risk is the biggest risk that you have in in banking. And one of the keys is also not to have any incentive for the top line. And our investments would have none of that. And then -- and like Eurobank is a great example, terrific bank, very private. I say private. When I first met them, I said, how are you compared to the other 3 or 4 banks. They say they are the private bank. So what do you mean, a private bank. As everyone comes at 9:00, we come at 8:00. Everyone leaves at 4 or 5 and we leave at 6,7,8. And I said, okay, I did that, hard-working group of people who work for a long time. And Brian Porter mentioned to me that the key is the ability to get the deposits, are like our float. And all our banks have that exposure and have that strength. And so we like it. You can see force on talking about 15%, 16%, 17% and paying back 50%, 55% of the profit through dividends and buybacks. So it's a big strength for us, and it's worked out very well. Jeff continues to work out very well. Number one?

It's Anderson from Calgary. Been with you guys as a shareholder since 2003.

22 years. It's a long time.

A little bumpy. Question for Peter. I know that Prem says, he has no plans to retire any time soon. But supposing he did, and you could only talk to him, say, once a week on Saturday morning, what would you still need to consult with them on? And what types of questions -- would you ask?

Well, I guess, first of all, yes, like you said, he's not going anywhere, and we're thankful for that. And my biggest issue is keeping up with Prem. That's the big -- the hardest part of my job, but no, it's been great. Now the company has been set up. I've been here for 28 years. All we have our guiding principles that we follow. Those will never change. And we're in very good alignment on where we want the company to go forward. I take -- I do talk to him most Saturday mornings, by the way, but -- and really look forward to that and the guidance. That guidance obviously is what Prem makes very good decisions. He makes decisions very quickly. And that's something that I respect greatly. And so those may be a couple whenever.

Whenever I talk to Peter 99.9% the same thing. We talk all the time. And Peter is basically in the company, everyone reports into Peter. And so slowly, but steadily, we are working that through. All the people are reporting to Peter. The investment side comes under Peter, he knows about what's happening on both sides and like I tried to do. And so it's working very well. But 22 years is terrific, and I hope you've held all your shares and that's terrific. That's a really big -- big shareholders who've got very wealthy. And I hope that's the same experience you have. But thank you for your question, number one. And Number 1, number 2 -- and then we go to #3?

Akash again. When studying Fairfax, I was looking at other similar great companies like Berkshire and Markel. And one thing that is different is the investment leverage, which is sort of the investment assets by equity, where Fairfax is at around 3:1, Markel, maybe 2:1 and Berkshire 1:1. So -- and they all have different amounts of equity in their portfolio equity holding. I just wanted to get your sense of what are the puts and takes because of operating with that leverage, maybe a higher leverage, which obviously provides for a higher ROE, but we also know there's no free lunch in finance. And just a separate question, as a big tennis fan myself, I would love to know Prem who's your favorite tennis player.

Djokovic.

The other well, the other question was just on investment leverage. Obviously, we've had an outstanding track record on the investment side. And as I pointed out in our slides, one of the biggest -- one of the biggest things how [indiscernible] Watsa has outperformed the market is protecting on the downside. As you said, in 1987, we made money. We didn't lose money. 2008, 2009. We actually made money while most of the industry lost money. So that investment leverage very -- it's attractive to us. And as long as we continue to invest with a long-term value approach with preserving capital, I think the -- we have no problems with their leverage, and it's been a big part of growing our book value over time.

Well said, Peter and Akash remember, if we hadn't bought how many, 28 to 21 shares, our leverage would be low. So we're buying it because the shares are cheap, not because we're trying to get the leverage up to 3x. And the stock is at above its intrinsic value, for example, we're not going to buy, leverages will be coming down. But now we will look back at these shares that we bought last year and the year before and in the first quarter, you're going to look back and say that, God, they did that. And -- but always, as he said, with our financial position very sound. But thank you for that question. We'll go on to my man, is that a Alan Chan.

Yes. unfortunately.

And how long have you been a shareholder, Alan?

Only 28 years.

28 years, give him a nice round of applause, and he's a young man and he doesn't have to work.

So I have two questions. One is for Prem and other one is for Peter. So Prem, my son wants to be a filmmaker. So when are you going to increase the dividend to...

I don't think you need that, Alan.

So second question for Peter. Since you're in the insurance business, how can you ensure that the stock price will be $5,000 within the year? Thank you.

Thank you. That might be it. It was more of a comment than a question.

I thought you wanted an answer i was worried what Peter was going to say. So it's pretty well, timing is good, 12:00. You got any question here, Jeff, that the last question?

There actually is one last question here that's come in just in the last few minutes online. Question is as follows. You've had exceptional growth in float at Fairfax. At what scale do you believe it becomes difficult to earn the required return on this float? And how do you adapt your investment strategy accordingly?

That's another very good question. A smaller amounts of money are easy to manage the large amounts of money. But in the insurance business, you have a limit as to how much you can put into stocks. So out of that $75 billion portfolio, only about $23 billion, $24 billion, something like that is in common shares and in holdings of companies. And that $23 billion, $24 billion, and you look at the world, we think we still have lots of opportunity. And -- but we have to be careful how you choose and that type of thing. We have big friends in India. India has got a fantastic opportunity because it's going from developing country into a developed country over the next decades. But we really want to take a moment to thank you all for coming. We look forward to having a little bite with you and the foyer and thanks for all the people who helped with this meeting together. It takes a lot of time and effort. So thank you very much. Very well done boys.