SCOR Aktie

Good afternoon, ladies and gentlemen, and welcome to the SCOR Second Quarter 2026 Results Conference Call. Today's call is being recorded. [Operator Instructions] At this time, I would now like to hand the call to Mr. Thomas Fossard. Please go ahead, sir.

Good afternoon, everyone, and welcome to SCOR Q2 2026 Results Conference Call. I'm joined on the call today by Thierry Leger, Group CEO; and Philipp Ruede, Group CFO, as well by the other Comex members. Can I please ask you to consider the disclaimer on Page 2 of the presentation. And now I would like to hand over to Thierry.

Thank you, Thomas. Hello, everyone, and thanks for joining us today. We are pleased to report a strong and clean set of results in the second quarter and for the first 6 months of the year. Group net income reached EUR 409 million in the first half, corresponding to an annualized return on equity of 19%. Our balance sheet resilience has grown with a solvency ratio of 220%, up 5 points compared to the year-end 2025. The underlying capital generation is in line with our 2026 guidance, reflecting the solid performance of all our activities. We also had some additional positives during the first half, including the benign cat activity and further ALM refinements. These allowed us to add resilience to the balance sheet and lower our debt leverage.

Turning to our 3 businesses. P&C continued its strong performance, delivering a combined ratio of below 80% in the first half. This is supported by a relatively benign cat activity and an excellent attritional loss ratio, demonstrating the quality of our well-diversified P&C portfolio. Our strategy to grow in diversifying lines of business is paying off. At the midyear renewals, SCOR applied disciplined underwriting in a competitive environment, allowing us to preserve our technical margin with a limited 2 percentage points underwriting ratio increase. whilst still finding attractive opportunities to grow our P&C treaty portfolio by 3.2% year-to-date.

As in previous renewals, growth was mainly driven by our preferred and diversifying lines of business, whilst we remained very cautious in U.S. casualty. In addition, premiums in alternative solutions grew by more than 70%, 7-0, demonstrating the strength of our teams and franchise in that segment.

Before moving on to Life & Health, I would like to say a few words regarding the net cat events that are ongoing at this moment. Europe and Canada are experiencing devastating wildfires. Japan just had a magnitude 6.8 earthquake on Tuesday night. First of all, our thoughts are with the people, the businesses and the intervention teams impacted. As these events are still developing, it remains too early to assess the ultimate loss impact. However, at this point in time, we think that the impact on SCOR will be relatively modest.

Turning to Life & Health. The insurance service result stands at EUR 157 million over the first 6 months. This includes the negative EUR 64 million one-off arbitration impact. Since the Life & Health reset in 2024, we have now performed 6 quarters in a row, in line with our expectations, further building our confidence in the quality of our Life & Health portfolio and assumptions. We are satisfied with the new business production in Life & Health at EUR 216 million of CSM. This was mainly driven by protection, but our Finsol financial solutions and longevity pipeline is growing, positioning us well for the second half of the year.

Our teams remain highly active, building a solid flow of opportunities across traditional and structured solutions, leveraging SCOR's franchise and expertise in Life & Health across the globe. Lastly, investments continue to provide a stable and positive contribution to group earnings. Based on this strong set of results for the first half year, I see SCOR well positioned to achieve our targets for the last year of our 3-year strategic plan Forward 2026. Philipp, over to you.

Thank you, Thierry. Good afternoon, everyone, and thank you for joining us for SCOR's Q2 2026 results presentation. I will briefly take you through a few key highlights of the quarter before we move to Q&A.

The key message is clear. SCOR delivers another strong quarter. All 3 business activities contribute positively, reflecting the strength of our franchise, the quality of our diversified model and our disciplined execution across underwriting, investments and capital management. Group net income reaches EUR 188 million in the quarter on an adjusted basis.

On the same adjusted basis, this translates into an ROE of 18% for the quarter and 19% for the first half of the year, well above our forward 2026 target of 12%. SCOR's economic value stands at EUR 9 billion at the end of June, up 10.5% at constant economics over the first half of the year. Our solvency position remains strong with an estimated solvency ratio at 220%, up 5 points versus year-end 2025 and stable compared with Q1 2026 despite the deleveraging actions taken during the quarter.

Turning now to P&C. The quarter is particularly strong. The combined ratio is at 79.5%, supported by an excellent underwriting profitability, a benign net cat environment and our ability to build buffers while still delivering a strong reported performance. P&C new business CSM increases year-on-year, reaching EUR 255 million in Q2 and EUR 978 million in the first half. Year-to-date, we have maintained a disciplined approach to portfolio management, delivering growth while containing net underwriting margin pressure and benefiting from lower retrocession costs.

In Life & Health, performance remains stable and in line with expectations. The insurance service result stands at EUR 49 million. But excluding the one-off arbitration impact, it would have been EUR 113 million with a positive experience variance of EUR 4 million. This confirms the benefits of the portfolio actions taken over the last 6 quarters.

In investments, we continue to benefit from the higher rate environment. The regular income yield reached 3.6%. Return on invested assets is at 3.7% and the reinvestment rate remains attractive at 4.3% as of June 30. On ALM, we made further progress by refining our hedging strategies. Consequently, we have increased the duration of the invested asset portfolio to 4.4 years compared with 4.1 years in Q1 2026, taking advantage of the higher interest rates. By strengthening balance sheet protection against interest rates and foreign exchange shocks, we support greater solvency stability over time.

Let's now look at the June, July renewals. Market conditions remain competitive, particularly in property cat, but we found attractive opportunities in other areas. EGPI from traditional reinsurance increased by 1.3% over the period, supported by strong momentum in specialty lines, which were up 19.8%. On the other hand, alternative solution EGPI increased by 133% Year-to-date, as Thierry said, the increase in the net underwriting ratio has been very limited. This demonstrates our ability to navigate a more competitive market with discipline while continuing to grow profitably and selectively. Overall, Q2 confirms the core message of our plan, strong earnings, disciplined underwriting, attractive investment income, robust capital and continued progress on balance sheet resilience. We enter the second half of the year from a position of strength with confidence in our ability to deliver forward 2026. Thank you very much. I will now hand over to Thomas for the Q&A question.

Thank you very much, Philipp. On Page 22, you will find the forthcoming scheduled events. With that, we can now move to the Q&A session. Operator, let's move to the Q&A session.

[Operator Instructions] The first question is from Shanti Kang, Bank of America.

So I just had one on P&C to start with. So if I try and work out the underlying attritional, it looks like the second quarter of this year underlying was super strong compared to last year. Is that surprising to you? I was just wondering if you could help us characterize the underlying, especially given the IBNR loading taken today? And then the second one was just a sort of hypothetical question. If ultimately 2026 proves to be another relatively benign cat year, is your preference to allow earnings to flow through? Or is it to keep building prudence or to keep building excess solvency, for example? So in other words, where does the next euro of favorable experience go into the second year?

Thank you, Shanti. I'll take the first question on the attritional. So yes, the second quarter delivered another strong underlying performance before any additional prudence. The underlying attritional loss ratio remains broadly in line with the very favorable trend observed in '25 and '26. As always, this volatility quarter-to-quarter, whether favorable or unfavorable. And so for that reason, we believe the most relevant indicator is the full year rolling 12-month views, which provide a more representative picture of the underlying profitability, and this has been broadly stable, I would say. The strength of the underlying performance is based on the underwriting years '25, '26, mainly, which from a price adequacy are very strong. And so we think this strong attritional underlying should continue for a number of quarters to come.

On your second question, directionally, we would not let the good cat go through P&L, but rather continue in our current approach, which is to use it as an opportunity to build buffers in IFRS and in spirit, normalize to an 87% cat ratio. Combined ratio.

The next question is from Andrew Baker, Goldman Sachs.

First one, just on the P&C reinsurance revenue. Are you able to give us a sense of what the constant FX growth would have been without the EGPI revisions on the existing business? And I guess, can you talk a little bit about your process for these revisions? I guess if I look at, you've obviously done this through 2Q, whereas all of your peers, we saw a similar impact on Q1. Just curious if there's a reason why you think the might have been a timing difference here? And then secondly, can you just help me think about the mix effects on the combined ratio? I guess on a year-to-date basis, it looks like at least from an exposure perspective, you've grown cat quite a lot and which presumably is favorable from a mix perspective. But then you've also grown on the alternative side a lot as well, which presumably is maybe a higher combined ratio business. So leaving pricing to one side, how should I think about the mix impact going forward from the business written already this year?

Yes. So I will hand it over to Jean-Paul for the future of EGPI. But in terms of the impact on reported, the revision would have 2% impact. and the FX around 2% as well. So on a constant FX, it will be flat and the GPI would be 2%.

Then to your question about the process, this is something that we do every quarter and I have always done where the underwriters assess the EBA estimates of the cedents to -- with the latest information. Here, what we've seen some revisions also in Q1, but to, I'd say, a lesser extent. And Q2 is just when we had more information. I think what we're seeing is insurance companies are having a tough time meeting their premium estimates for underwriting year 2025 mainly. And as a result, we've started to take a more conservative approach in our estimates for 2026 based on the information we have at hand. So we think we added some more conservatism, but it really depends on how well the companies achieve their objectives in 2026. On your second question about the mix, if you don't mind repeating your question was about the mix on the combined ratio?

Yes, exactly. Just the fact that you've grown, obviously, in cat business from an exposure perspective a lot this year, which is presumably beneficial from a mix perspective. But then you've also grown alternative a lot as well, which presumably might be a headwind. So just do you expect the mix to be a positive or negative on the combined ratio going forward based on the business written already this year?

Yes. So I think the business mix is definitely a positive. And this is how you can see in the limited net underwriting ratio that we expect from the renewals. If I decompose a little bit your question on the alternative solutions, you have to remember in IFRS 17, the combined ratio is actually quite low because you take into account only the premiums at risk versus the expected losses, which are limited. So the actual IFRS 17 combined ratio for IS is actually quite slightly better than, let's say, the 87% or below 87% target. On the other hand, the amount of revenue that AIS generates is small because you only take into account the premium at risk, not the entire EGPI. In terms of the business mix, where our actions of underwriting actions have done is growing cat where we still see good price adequacy, growing specialty in the areas in specialty where not only is there good price adequacy, but also where the combined ratio tends to be a little bit better and decreasing where we see price adequacy slipping and then the net combined ratio as a consequence is higher. And then also reducing U.S. casualty, which has a high net combined ratio. So the combination of all these actions has a positive effect on the overall net combined ratio.

The next question is from Will Hardcastle, UBS.

I guess just thinking about the solvency level, how are you thinking about it being at the upper end of the current optimal range? And should we be thinking about a higher target range as a possibility? Or does the 185% to 220% still hold? And should we be using this metric as maybe our core proxy on capital levels? Or is that not the binding constraint here? Secondly, one of those specialty lines that you've grown -- you call out for growth is credit and surety. I guess I'm just interested in what's making this much more attractive year-to-date. We're hearing it from a few competitors as well. And just wondering if this is -- there's a huge uptick in demand for the product or it's just you're achieving this business off someone else?

Yes. So -- on the Solvency II, right, you're right to note that we are at the upper end of the current range. But like quite consistently, we've been saying that the priority is balance sheet resilience. And in that sense, we will talk, of course, at Investor Day on how we see that in the next strategic plan. And I can't really comment more at the moment. But directionally, we want to operate higher.

On your question, Will, on credit and surety. So what we put in the credit surety, there's credit and most of the trade credit renewals are really at January 1. But then there's surety and other credit products -- and what we've done is build a very diversified portfolio across the credit and surety segment. There's a lot of opportunities in surety over the last, let's say, 24 months. We see, for example, surety in Brazil as a market that's grown very substantially over the last 2 years and very profitably. There's also surety in India, which has been a developing market where we've been one of the leaders in developing that market. And then the U.S., of course, remains a very large market.

In that segment, in the U.S., there's been a number of losses going through and the U.S. market is mainly excessive loss market. And as a result, the prices on the excess of loss have increased. And then we've been able to push for sort of compensating business on a more proportional basis on some of those programs. So at June, July, it's still a relatively small renewal overall. And the growth was driven by a few transactions, growth coming out of Latin America, the U.S. and then one large transaction in Europe. And going forward, it's a line of business that we think where price adequacy remains good. Competition is still a lot of competition. But I think given our franchise and I think our very significant presence in this line of business, we remain one of the go-to markets in that field, and I think we remain well positioned for future growth in that segment in '27.

The next question is from Michael Huttner of Berenberg. Fantastic.

I've got the -- ideally, I'd like to ask what your targets are for the 3rd of December, but I guess you can't tell us quite yet. But -- so state of play on Core, I think there's still an outstanding lawsuit. What could be the financial impact of that? And then the other question is, what's the buffer level? So you very helpfully said EUR 300 million you added to buffers in Q1. I think looking back at the end of 2024, you had over EUR 300 million. And I don't know what the figure is for '25. Any help here would be very welcome.

I'll take your first one on Korea. So obviously, this is all confidential. So there's not much we can say. But maybe just so much. First of all, on the second arbitration, we are very confident. Personally, it ranks pretty low on my list of worries. But of course, we -- it is there. And as with other arbitrations, it's something we will be focused on. We, however, expect the process to be a bit less heavy on this one. Allow me to say this as a nonlegal expert, but we expect it to be a bit less heavy compared to the first one. As we said already, typically, arbitrations take 2, 3 years. But again, I'm very confident in the outcome of the second one. The key one was the first one. That's now behind us, and we are pleased to look ahead now.

On the buffers, just to recall, so in Q1, what we did besides adding to the balance is that we transferred CHF 300 million from IFRS into the best estimate liabilities. So the impact on the overall prudence was 0 of that, but it meant that it had a negative impact on the Solvency II. So that's what happened in Q1. Since you mentioned those EUR 300 million, I mean, otherwise, we don't comment on the overall stock, but you will note that we have added in Q1 and that we have added in Q2, again, actually more than in Q1. And so we continue on that journey.

The next question is from Kamran Hossain from JP Morgan.

Two questions from me. The first one is just on the Solvency II ratio. Clearly, the last 2 quarters, you've taken actions to improve the quality of the ratio, kind of best estimate P&C liabilities Q1 deleveraging this quarter. Is it safe to assume that deleveraging is still the focus here on improving the quality there? Or is that something we have to wait until the 3rd of December to hear a bit more about? The second question is on Covey, the first arbitration, so the one that's actually kind of done in the past now, hopefully. Does this mean that cash flow going forward in Life & Health will improve? Just totaling up the kind of cash flows for the last 3.5 years from Life & Health, the operating ones, it doesn't seem like it's especially positive. So just interested in whether with the first arbitration being behind you, that means cash flow will improve in Life & Health.

Yes. So on your first question, I mean, the focus on balance sheet resilience includes the 2 things that you mentioned and the third thing being the absolute level of solvency ratio. So yes, our mind is on putting buffers in the best estimate liabilities, deleveraging. And in terms of the deleverage, we will continue to deleverage. The question is at which speed.

On the cash flow, so I would just caution you a little bit that -- I mean, that the period that has passed, right, which is the number that you probably have in mind, included significant COVID-related claims. And therefore, it's not a good basis for the extrapolation into the future. And I think in the overall cash flow, this will not have a significant impact given all the other aspects and the volatility of this number on a quarterly basis.

Okay. Just to maybe just come back just to be clear, so the minus EUR 42 million, for example, in Q2, some of that relates to COVID from 2020, 2021.

No, no, no. Sorry, that is purely on your question about the retrocession and not what happened in Q2. But I think the figure that you see in Q2, the typical fluctuations we have it from quarter-to-quarter.

The next question is from Iain Pearce, BNP Paribas.

The first one is just on the capital generation number. So Q1, you guided 3% to 5% net of the dividend accrual and we're at 5% in Q1. It sounds like there has been positive net capital generation in Q2 again, quite a strong number. Just wondering why you're not bumping up the capital generation guidance for the year? And if there's anything we should be thinking about into H2 around new business strain expectations or anything as to why that number has not been increased.

And then the second one is just on the Alternative Solutions growth. Obviously, it's been very strong. We have peers sort of flag demand headwinds in alternative solutions. So just if you can give us some color on what you're seeing in the market, what's supporting that level of growth? And also with that growth now leading to alternative solutions in 20% of EGPI, do you see a maximum level for that? Or are you happy to continue to grow this book ahead of the wider traditional business?

So on your first question, we would maintain the guidance of 3% to 5% because the drivers were the good luck in net cat, and we don't want to extrapolate that necessarily into the future. And on the ALM, what we did is improvements. I mean you can actually see that we lengthened the duration from 4.1 to 4.4 years on the asset side, and that led to a lower requirement in the SCR. And so these are improvements, but more one-off in nature. And therefore, our guidance is really for the capital generation of the core business.

And your second question on AS. So year-to-date, the growth of AS has been really spread geographically across Europe, U.S., Latin America and Asia. At the June, July renewals, the growth has been specifically concentrated in the U.S. just because of the renewal dates in that region. what we see is the clients where we've grown has been 2 parts. One is growing shares on existing business. And this is -- I think as CRE becomes a bigger challenger in this field, clients are more comfortable allocating larger shares to us. The second one was new business. And here, a number of clients are just using AS as one of their capital management tools regardless of cycle.

There are some clients that actually use AS when the market is hard and soften the impact of the price increases. And there, we do see demand going down. There's been also a number of clients that have been using AS when their surplus was depleted. And then as the real surplus, that demand goes down as well. Those are not clients where we have large concentrations. The business -- the new business we're getting on right now is more clients that use it as a capital management tool. And we see further growth opportunity because our shares relative to market leaders remains still small. So I think there's still room for us to grow.

And on your question of the relative size to P&C, I think right now, we feel pretty comfortable that if there's room to grow in the segments that we're targeting, we're happy to continue the growth. So we're not chasing the growth. It has to fit our risk appetite.

The next question is from Vinit Malhotra from Mediobanca.

So my question is more -- so if you look at the new business CSM in P&C, 13% growth, and you're talking about retrocession benefits and other drivers. I'm just curious, I mean, if we are getting such good numbers, I mean even though retrocession economics, Gerry, you said in 1Q was favorable economics. But even though that might lead to some lower net top line, surely, the combined ratio should be getting better. Is that a fair assessment of how this new business CSM -- and I know I'm not trying to preempt the guidance here, but just a trend of thought, is that what you would agree with that the better retrocession dynamics, the combined ratio should get better.

Second question is just on strong attritional loss ratio mentioned. The presentation also noted man-made. Could you just help me understand if manmade was a big driver in the improvement? Was it a big factor last year and was less low factor this year or something? Any comment to that?

So on the new business CSM, I won't split it, but there's really 3 drivers. One is we have growth in volume. So that's a positive. Then as everyone else, we have a reduction in the margin, and that's more substantial than the volume growth. And then the third one is the reduction in the ceded new business CSM on the retro side. And these 3 factors are roughly offsetting in the big scheme of things. And then on the combined ratio, I'm not sure I understand the question properly, but I will try. I mean, ultimately, if you look at it, the net combined ratio deterioration that we see is 2, and we would say the gross one would have been 3 points. So it is helping us in dampening the deterioration of the combined ratio. Is that clear?

Yes, sure. I was just trying to say that when you see such strong new business CSM in the face of these kind of markets, the temptation would be to think that the positive effects are a little better. So I get the 3% and 2%, but maybe the dynamic is that it will help more than we thought or more than you thought earlier.

I think the combined ratio as hinted at the renewal, ultimately, like-for-like, we would expect as it earns through a deterioration of 2%...

And Vinit, on your second question on the attritional. So this quarter, man-made was, I'd say, in line with expectations. As I mentioned before, it's better to look at it rather than on a quarter-by-quarter basis, more on a rolling 12-month basis. And what we see for that is a fairly stable attritional for the past quarters. I think this is also why we've been able to build a significant amount of buffers in '25, '26. And as I said, we -- as the portfolio underwritten in '25, '26 continues to earn through the rest of this year, I think the expectation would be similar trends to be observed in the second half of the year, bearing any unforeseen large man-made losses or large losses overall.

The next question is from James Shark of Citi.

My two questions. Firstly, I just wanted to delve into the P&C Re expense ratio. So we're kind of 8.2%, up 40 basis points year-on-year. And there's a comment in the presentation it's pretty stable versus Q1, but actually have it up also up about 40 basis points versus Q1. Obviously, some of that is coming from the top line pressure, but there's quite a big move offsetting some of that underlying attritional loss ratio improvement. So my question is really kind of do you view the expense base as being the right one for the shape of the business going forward? And do you expect, therefore, to be able to grow it back down to historical levels? That's the first question.

And secondly, I just wanted to ask a bit more about your use of retro because if I look at your gross ISR versus the net ISR, and historically, you're giving away about 50% of your gross ISR to retro, which seems a massive number. I understand the balance sheet is in a much better place and you're introducing various amounts of kind of buffers, et cetera. Is that the right business model to rely on that amount of retro going forward? I mean, obviously, you've got the Capital Markets Day, I want to preempt anything from that, but it just seems a very high level for you given the strength of the balance sheet now.

Yes. So on the cost/income ratio, I mean, this can fluctuate quite a bit quarter-to-quarter. And it's also the divider is actually the net insurance revenue. So even the retro has an impact on the divider. So I would say, broadly, as a firm, we manage that at the group level, and we're committed to our EUR 1.2 billion of expenses, and we're on track to delivering that.

Then on the second part, I take the compliment on the strength of our balance sheet. But to your question, I mean, I think it is a very legitimate question on the retrocession. And indeed, this is part of our reflections that as we grow the strength of our balance sheet, but we would also -- it's not just the solvency ratio. It's also the prudence that we were able to build up that this is certainly going to be part of the reflection in the next strategic plan, whether that level of retrocession can or should be reduced.

The next question is from Ben Cohen from RBC.

I had two questions, please. The first was if you could just say a bit more about the improvement in the gross price year-to-date in the second quarter versus the first quarter. I guess that was a bit of a surprise to me given trends at least in terms of U.S. net cat markets. And the second question was in terms of revenue growth on the Life & Health side going forward. I guess in terms of the gross revenue growth, it was down in the first half. Could you maybe say more about why you have the confidence? It sounded like you're confident that, that is going to grow in the second half, but maybe you could say more about that and specifically where it's coming from.

So on your first question regarding the price, it's really driven by portfolio mix. So what happens at the June, July renewals, we have a higher proportion of nonproportional than at the prior renewals. That's one effect. And then the second effect within the nonproportional, we have a higher percentage of property cat and property cat is where we've seen the largest price decreases relative to other lines of business. So this is why the price -- the gross price decrease for the June, July renewals is higher than what we saw in April and July. But again, it's -- the trend that we've seen has been very similar for -- from the April and January renewals. I'd say on the property cat, we saw price decreases in the U.S. around minus 20%. Outside the U.S., we saw price increases on cat between 10% and 20% and other lines of business, I'd say, very similar to what we saw in other renewals. So for us, June, July is a continuity of the prior renewals. And the overall net impact to -- on our net combined ratio remains limited. June, July is a relatively small renewal compared to the overall book and the impact of this on the overall book is very limited.

On the Life and Health insurance revenue, I mean, this is totally in line with our expectations because it is a consequence of us prioritizing profitable growth and focusing on higher-margin opportunity. And as a result, we've seen lower insurance revenues in certain protection portfolios that we discontinued. Having said so, I mean, if you actually look at the constant FX in the first half of 2026, it would only be down 2.9%, and that's probably a fair representation of the reduction in volume.

Okay. And sorry, the -- I mean, are you confident that, that changes? Or is there more of that effect to come through in the second half of the year?

We are confident protection we keep being very selective, and we are seeing the opportunities. Probably you've seen new business CSM, which is okay. And then we have a good pipeline for financial solutions and longevity. Typically, the first half of the year is more quiet on these sizable transactions. But yes, we are seeing the market dynamics, and we are working for executing as soon as clients are ready.

Then when we presented the updated strategy in Life & Health, we are very clear, right, that there would be some sort of a U-shape -- so as what Philipp mentioned before, is coming through slowly and what added with what Peter just said on the future growth opportunities. And if you combine the 2, you can now see this U-shape coming in. We don't exactly know when the bottom will be reached. At some point, we will reconnect this growth.

The next question is from Benoit Valleaux, ODDO BHF.

Two questions. The first one is more a follow-up on Solvency II margin. In Q2, you have this positive ALM. You just mentioned that you increased your asset duration. And you say it's a one-off. But my question is, should we expect maybe more to come and you believe that you might increase further your asset duration or not in the next quarters? And linked to this, you mentioned that you could to deleverage the balance sheet. But do you believe that it could make sense also for you maybe to build some additional buffer within your best estimate liability under Solvency II as you did in Q1 in a specific situation? And my second question is related to tax rate. Tax rate in Q2 was very low. I just to check if it's just your mix effect. If there is anything else to be mentioned? And also linked to this, you have redomiciated some earnings to France this year. Can you give you a view on what could be a normalized tax rate in 2027? Or is it a bit too early?

So on the asset duration, we're very happy with the progress that we made on the ALM, and we're moving more into a business as usual phase going forward. So you should not expect any adjustment of that size in terms of the duration. We were just -- we had a need to lengthen. And given that when the conflict started, interest rates went up, we felt the timing was right -- but in that sense, on the duration side, you should not expect big movements going forward rather that this is kind of the closure of multiple years of efforts in matching interest rates and currency better. Then I mean, for me, the two are, to a certain extent, a bit interchangeable, right, whether we do deleverage or whether we add resilience to our best estimate liability. It is a form of balance sheet resilience. And so we will look at it as the opportunities arise. I would say maybe not exactly your question, but of course, and I've been saying it for months that the solvency ratio is a very high priority for me, and we will continue to see what actions can be taken left, right and center.

And then you asked about the effective tax rate. So I would say it's just important to remember that on a quarterly basis, the effective tax rate can be quite volatile, right? Having said so, and you made reference to the French tax parameter and all the efforts that management has made to address this issue. And we did actually, in the second quarter, for the first time, recognize the benefit linked to the re-recognition of tax losses carryforward linked to the French tax parameter. Then in terms of outlook for '27, that's way too early, and you said it yourself. So I'll just confirm that. But in terms of '26, we would probably expect to be below the 30% that we had indicated.

The next question is a follow-up from Michael Huttner.

I had two. So the one is on a broader question on the market terms and conditions. I think we heard yesterday from one of your smaller peers that they're softening. And I just wondered how do you see that and whether it's -- I'm sure it's already in your combined ratio, but just a feel for it. And then the second kind of related on Slide 21, you show the premium mix at the renewals. So property and property cat are down. But the -- on another slide, you showed that the PMLs are up. I'm sure it's a really easy explanation, but I'm just curious why this kind of divergence. And then last one, last one, and I shouldn't. But the Covea EUR 64 million, is that a pretax or net of tax figure? And what would be the net of tax?

So quickly, 64% is ISR pretax, post tax it's 49%.

So on your first question, Michael, in terms of conditions and renewals. So we did see, especially at the Florida June renewals, clients coming in with attempts to broaden the terms and conditions with drop-down covers, top and drop cascading structures. This has been, I'd say, broadly resisted by traditional reinsurance. There has been a few insurers that were able to place this with the ILS markets, but the traditional reinsurers have resisted broadly. And outside of Florida, we've really seen very little softening of terms. Attachment points are remaining stable. reinstatements are remaining stable. The event definitions, everything else is remaining stable. It's been really renewals focused on price.

As we look forward to 2027, of course, terms and conditions would be an area, a topic of discussion at the negotiations. But I think reinsurers have stayed very disciplined so far. Our intent is to continue to do so, and we'll push strongly for remaining disciplined in the upcoming renewals. In terms of your question on premium and PMLs, so just to understand, as rates decrease, if premium is stable on property cat, -- that means we've increased exposures to sort of match the decreasing premium rates. So that could be the explanation you're looking for.

The next question is a follow-up from Will Hardcastle, UBS.

I was expecting the PMLs would have reduced with the added retro, but this hasn't really been the case. I guess is the retro operating more in the belly at the risk as opposed to the tail? And are you able to help us consider whether any further optimization of retro that was perhaps mentioned is more like to focus on capital or earnings volatility? And just on the second one, just coming on to the investment duration. You've increased it from 4.1 to 4.4, as you say. Can you help me to understand how you've achieved this? I'd imagine only a little over 5% of the portfolio probably turns over in any one quarter. So wondering if that's all being invested in closer to 10-year average duration? Or is it through derivatives?

So, I'll take the first question. On the retro, again, focused on cat, the -- we buy both proportional and nonproportional retro. Proportional retro plays across the gamut of earnings and capital protection. The nonproportional depending on the layer, also has different benefits. The lower layers are really earning protections and the higher layers are more capital protection. So the retro program really covers, I'd say, both areas on the balance sheet. And then when Philippe talked about the optimization that we might be looking in 2027, we'll definitely look at both aspects.

Yes. So on the duration, what we did not use any derivatives, it's purely cash instruments, and we saw -- we sold a little bit of corporate short duration and bought government bonds with quite long duration to better match some of our life and health liabilities. and in the process actually picked up a bit of yield.

The next question is a follow-up from Vinit Malhotra, Mediobanca.

I saw the time and I thought I'll ask one more. The split of revenue between SPS and P&CB is quite interesting because the SPS growth, 4.1% is probably one of the higher prints seen in many recent quarters, while P&C, obviously, you've explained ceding revisions and other things. I'm just curious whether -- so the IR team has said that there's some seasonality, but could you just comment a little bit more about SPS if that 4.1% has any more background that you could help us understand.

Okay. Thank you, Vinit. I think we do see going forward SBS playing a stronger role in the overall revenue growth just because of the breadth of the insurance market and the very small footprint we currently hold, there's more opportunities to target pockets of profitable business than there is in reinsurance where we already have a footprint. We do expect some growth in reinsurance, but I think SBS will probably be a stronger driver. Here, what happened in Q2 is really, as mentioned, seasonal. It depends -- the renewals for SBS tend to be concentrated in Q2 -- and so as the premium earns through and SBS earns through relatively quickly because our book is very short tail, that has the effect that we're seeing in Q2. So there's nothing, I'd say, out of the ordinary other than we do have growth plans for SBS in 2026, and those are starting to materialize in the balance sheet.

Ladies and gentlemen, this concludes today's Q&A session. At this time, I would like to hand the call back to our speakers for any additional or closing remarks.

Thank you. Thank you very much all for attending this conference call. We remain available for any follow-up questions you may have. As a reminder, SCOR will release its Q3 ' 26 results on Friday, 30th of October with a call as usual as 2:00 p.m. CET. And with this, I wish you a very good summer break and see you soon. Bye-bye.

This concludes today's call. Thank you for your participation. Ladies and gentlemen, you may now disconnect.

Good afternoon, ladies and gentlemen, and welcome to the SCOR First Quarter 2026 Results Conference Call. Today's call is being recorded. [Operator Instructions]

At this time, I would now like to hand the call to Mr. Thomas Fossard. Please go ahead, sir.

Good afternoon, and welcome to the SCOR Q1 2026 Results Conference Call. I'm joined on the call today by Thierry Leger, Group CEO; and Philipp Ruede, Group CFO, as well as other Comex members. Can I please ask you to consider the disclaimer on Page 2 of the presentation.

And now I would like to hand over to Thierry.

Thank you, Thomas. Good afternoon, everyone. Thanks for joining us today. I'm glad to announce a strong start to 2026 with continued and disciplined delivery at all levels. The group net income reached EUR 220 million in Q1, corresponding to an annualized return on equity of 21.1%. The solvency ratio increased by 5 percentage points to 220%, driven by strong underlying operating capital generation.

All our 3 businesses contributed to the solid performance. I would like to point out explicitly that this was achieved, including additional opportunistic buffer building of EUR 300 million and precautionary means 100% IBNR based reserving for the Middle East conflict. The impact of the conflict in the Middle East is twofold. One is the direct impact on our business. As mentioned during the Q4 earnings call, war risk is systematically excluded from standard reinsurance treaties.

It is one of the very few exclusions that is truly universal regardless of market cycles or conditions. If war risk is covered, the exposures are priced for and carried mostly by specialized markets. SCOR's participation in this market is limited and within a strictly controlled framework. The second impact is indirect related to foreign exchange and inflation in the context of heightened geopolitical tensions. These secondary impacts are monitored and managed as part of our regular processes in pricing, reserving and ALM.

Let me now turn to the P&C renewals in 2026. In a more competitive environment, we have been able to increase the year-to-date premium income by 2.4%, whilst limiting the margin deterioration. We continue to focus on our preferred lines of business in line with our strategy to grow profitably and in a diversifying way. The April renewals represent around 12% of our reinsurance portfolio.

We prioritized margin protection and implemented targeted portfolio management actions, including the nonrenewal or resizing of underperforming business. This led to a reduction in premium income but allowed us to maintain the quality of our portfolio, positioning our book for long-term performance.

Consequently, the technical results deteriorated by 0.6 percentage points better than the previous renewals. Looking ahead, we prepare for increased competitive pressure. We will continue to apply underwriting discipline and to focus on our preferred and diversifying lines of business.

Our priorities are clear: capital allocation to the most profitable and diversifying lines, combined with disciplined underwriting. In an environment that becomes increasingly competitive and shaped by macroeconomic and geopolitical uncertainty, our teams remain focused on executing the Forward 2026 strategy. This has allowed us to deliver excellent results while continuing to reinforce the resilience of the group. I see SCOR well placed to make the best out of the current environment and to deliver on the last year of our Forward 2026 strategic plan.

Philipp, over to you.

Thank you very much, Thierry. Good afternoon, everyone. I'm pleased to present our Q1 '26 results. I will focus on the key highlights for the quarter. All 3 business activities delivered a strong Q1 '26. Adjusted net income was EUR 220 million, translating into an annualized adjusted ROE of 21.1%, well above our 12% Forward '26 target. On the P&C side, we delivered a strong ISR of EUR 255 million. Insurance revenues grew by 5.4% at constant FX, driven by a satisfactory set of renewals, although reported growth was impacted by adverse FX effects.

The combined ratio stood at an excellent 80.2%, reflecting very strong underlying technical performance. Our Nat Cat ratio of 4.2% reflects a benign quarter with the main impact coming from Storm Kristin in Portugal.

Underlying results are solid with a 77.7% attritional ratio that includes additional buffer building. It also includes a mid-double-digit IBNR provision related to the Middle East conflict, reflecting a prudent view of potential further developments. We are also satisfied with our Life & Health results this quarter, reflecting our focus to deliver a steady quarterly performance over the last 5 quarters. The ISR stands at EUR 107 million with all components in line with our expectations, including the CSM amortization rate and the risk adjustment release.

The experience variance is also within our expected range of volatility. The Life & Health business delivered EUR 115 million in new business CSM, driven by growth in protection and longevity. We also significantly improved our capital position with a solvency ratio increasing from 215% to 220%. This was supported by strong net capital generation in Q1, in line with our full year '26 guidance of 3 to 5 points of Solvency II capital generation over the year. This translates into an economic value growth of 7.4% at constant economics.

The economic value per share increased to EUR 51 at the end of March 2026. We continue our strategy to improve the resilience of our balance sheet, both on the IFRS 17 and Solvency II. To that end, in this quarter, we added an exceptional amount of EUR 300 million buffer to our P&C best estimate liabilities, which was made possible by an internal capital optimization.

To conclude, SCOR's strong first quarter performance and strengthened balance sheet confirms the group's positive outlook. This gives us strong confidence in delivering the Forward 2026 plan.

And now over to you, Thomas.

Thank you very much, Philipp. On Page 21, you will find the forthcoming scheduled events. With that, we can now move to the Q&A session. Operator, can we take the first question, please.

[Operator Instructions] The first question is from Michael Huttner, Berenberg.

So I saw these fantastic results, and I'm afraid the questions are a little bit on the sideline. But you talked about the retrocession benefit. I wonder if you can explain that a little bit. The only thing I noted is if I do the ratio of ceded premiums or ceded revenues to gross premiums, you actually seem to have bought more reinsurance. It has gone up from 26% to 29%. But that's my math. So that's maybe a bit silly. And the other question is own shares. So your share price is roughly [ 31 ] or something. And you have this option, which expires, I think, in the beginning of June to -- of [ '28 ]. How does that work, please?

Yes. Thank you. So you're absolutely correct. In terms of the insurance revenues, the -- in line with what we communicated last year in terms of the change of structure, we moved from nonproportional excess of loss to more of a proportional cover. And as a result, you see the session rate in terms of insurance revenues going up. However, in terms of ISR and margin ceded, we saw actually improvements in the economics of our retrocession.

And -- but the retro benefit, I think, also alludes to what's going to the...

New business CSM, yes, correct.

Yes.

So that is one place where you see it indeed. So in the new business CSM, you see that we spent less margin on the retrocession.

No number. Okay.

No, no.

To your second question on the option. So I think you mentioned 28th of June, the option expires on the 9th of June, so for your information. But of course, we are well aware of the option and what it represents. All we can say -- all I can say is that we will be rational about it, and we will act in the best interest of our shareholders. It's also -- I also want to make it very clear that we do allocate capital to the most attractive areas and that the option is one of the many options we have at hand, and it's not necessarily the most attractive one at each point in time. Example, Q1, we have privileged balance sheet resilience.

What's resilience?

Sorry, say that again, Michael?

What's resilience? Sorry, I didn't -- acoustically, I didn't hear what...

Yes, balance sheet resilience.

Balance sheet, yes.

Yes.

Thank you, Michael. Can we move to the next question, please?

The next question is from Shanti Kang of Bank of America.

So the first one was just on P&C on the attritional that was 77.7%. And you said that includes an IBNR load for the Middle East and some additional prudence that you've added there. If you strip that out, could you just give us a sense of the year-on-year deterioration in the attritional, excluding that? And then this kind of feeds into my next question, which was just on discounting, which was a bit higher than I'd expected given that we have lower cats. But it seems like you added on the best estimate liabilities as well. So is that feeding through into the discount impact as well for Q1?

Yes. So on your first question, the underlying performance is very strong. And the answer to your question is that there's almost 0 change compared to the previous quarter. And then your second question on the discounting, yes, so mechanically, by adding this buffer to the best estimate liabilities that mechanically increased the discount, this effect is around -- is less than 1 point, but that order of magnitude.

And then there is the low Nat Cat activity that mechanically also improves the discounting. So these are the 2 main factors for this relatively high discounting that we observed this quarter.

Okay. And sorry, just to follow up on that. On the loading, could you let us know which lines you did add on? I don't think that was casualty, but I presume the sort of longer tail as a result.

You mean on the best estimate liability.

Yes.

It's across the board. It's IBNR.

Thank you, Shanti. Can we take the next question, please?

The next question is from Andrew Baker, Goldman Sachs.

First one, just any views on the pricing outlook into the midyear renewals would be helpful. And any thoughts around terms and conditions. I guess as we're thinking about sort of price and volume trends, should we be anchoring more in what we saw in January or April? Just any thoughts around that topic?

And then secondly, is there any update on the Covea arbitration -- sorry, arbitration process? And I guess relatedly, sorry, just coming back to the call option. My understanding on the call option was that there wasn't an adjustment mechanism for the dividends. So was there any thoughts around exercising it prior to the exit date that's just gone? Or is there any connection with the arbitration process?

Yes. So on your first question, Andrew, the outlook for the midyear renewal, I'd say, remains similar to what we saw at the first half of the year, so a competitive environment. In this environment, our strategy will remain unchanged. We'll continue to prioritize underwriting discipline. In terms of conditions, what we saw in January and in April is broadly stable, and that's what we expect going forward as well. But the market remains competitive, and it will depend on which country, which line of business. But we expect a very similar trend to what we saw in the first half of -- the first quarter.

Regarding the Covea arbitration, we have -- we -- it's still the same news, which means no news so far, and we expect to see this finalized before the summer. So that's with regard to the timing. You made a link to the call option that maybe I got wrong. You asked that there is somewhat a connection with the call option, so we can't see any. You also asked whether theoretically, there's a possibility to call the option between now and the 9th of June. That's technically absolutely possible.

And therefore, remains one of the options for us. But again, here, I would like to emphasize that there are other options. And again, in Q1, we have privileged the balance sheet resilience very clearly. I hope I answered your question, Andrew. It was like 2.5 question to read into it.

Yes. You can't blame me for trying.

Thank you, Andrew. Can we move to the next question, please?

The next question is from Will Hardcastle, UBS.

Can you just help me with the capital optimization on the internal retro, I think it is. First of all, is this all own funds benefit? And I'm trying to understand how extraordinary this really is or whether there could be some further optimizations, presumably with Philipp coming in that you could be bringing to the table looking at it fresh.

Second question is somewhat linked. I'm trying to work out whether the 185% to 220% optimization range is still something that management would think about hard or whether it still stands really? And if not, what's causing the pivot if there has been one?

So on your first question regarding the internal capital optimization, as you centralize capital into up the -- your legal entity structure, you get a benefit in Solvency II in form of a reduction of the risk margin. And so you're right to point out that this is an improvement in your own economic funds.

And then you asked about the outlook. I mean, I can't really predict it. I can only tell you that, of course, you should expect that capital is front and center on my mind. And that, of course, we will look at every stone and turn it and see if there's something more to be optimized.

And I think there is some Philipp effect here, Will. On the solvency optimal range, your question, yes, you're absolutely right, 185% to 220%. That's the optimal range defined for the plan Forward 2026, and this is unchanged and will remain.

You have probably in the meantime understood that for the next plan, capital and cash generation will take an even more prominent position in our thinking. So expect an update on this range when we present the new strategic plan.

Thank you, Will. Can we take the next question, please?

The next question is from Kamran Hossain, JPMorgan.

The first one is just coming back to the kind of work you've done on the Solvency II ratio. In terms of the best estimate additions, clearly, very welcome increasing resilience there. You mentioned, I think, in the commentary that this -- the EUR 300 million was exceptional. Do you think you want to continue to add here? And how might that kind of -- what that might mean for solvency going forward?

Because I think my conclusion from it all is really that your guidance on capital generation is probably still exceptionally cautious. The second question is on the Life & Health experience variance in the quarter. I mean you're well on track for the run rate for the year on a quarterly basis. Is there anything to read into the EUR 16 million or it's just normal volatility?

Yes. So maybe on your second question, that's relatively straightforward in terms of -- this is totally within what we would expect the normal volatility to be in that sense. And on your first question, yes. So I would say our strategy is to build resilience both in IFRS and in Solvency II, and it has always been. The reason why we felt the need to communicate is just the size of the addition of EUR 300 million. And so you should take the size of this move to be exceptional. Now going further, I think we will update you at Investor Day in the context of the next strategic plan on how we intend to build and use buffers.

Thank you, Kamran. Can we move to the next question, please?

The next question is from Ivan Bokhmat of Barclays.

I mean my first question is just a small follow-up on this Solvency II buffer. Could you help me understand the risk adjustment buffer that you've been building under IFRS 17, does that fully translate into solvency? And therefore, this EUR 300 million just build on top of this? Maybe you could try to help us understand what the buffer might be in absolute terms after -- since you started building it up, it's probably well over EUR 500 million and then EUR 300 million at top.

And my second question is related to this limits of the price deterioration of 350 basis points to just 60 basis points that you just mentioned, Thierry. It looks very impressive. Maybe you could give a little bit more color on that and think that would you be able to use similar levels for the June, July renewals? And if I can squeeze in one last question, please? How would you characterize the reinsurance demand? Are we seeing any improvements? Because I think some of your peers in Bermuda have been suggesting that cedents are buying more. So just wonder if you could maybe quantify or give some color how it looks by regions.

Okay. So on your first question, so the resilience that we added the EUR 300 million is really an addition to our Solvency II balance sheet. and it's somewhat unrelated to the risk adjustment where we continue opportunistically quarter-by-quarter to build buffers if the performance allows to.

On your second question, Ivan, the price change of 3.5% reflects basically the price change for business renewed 1 year to the next on a gross basis. In addition to these price changes, you have to take into account portfolio underwriting actions, which you could see in the slide, there was quite a number of it at April 1 and the benefit of retrocession as well. So when you take all of that together at April 1, the net margin deterioration was limited to 0.6 points, and then when we look at year-to-date, that's where we see an overall deterioration year-to-date of 2 points or less. And that's really what you should be focusing on more than the price change.

On the reinsurance demand -- also on the reinsurance demand, Ivan, yes. Jean-Paul?

Yes, sorry. On the reinsurance demand, we do see increased demand from cedents with the price decreases, the ability for cedents to keep some of the savings, but also use some of the savings to buy additional reinsurance. And we do see this, and most of the additional buying has been, I'd say, at the top of programs due to buy more limit. So there is an increase of reinsurance demand, but still today lower than the amount of capital available from the -- a supply on the reinsurance side.

As Jean-Paul was talking, I was thinking about what's the easiest way to explain how we can have a 3.5 points price deterioration, but still have only a 0.5 points deterioration of the combined ratio. So you also -- so beyond what Jean-Paul said and the retro -- positive retro impact, you should also imagine that the business we let go is obviously a business with high combined ratio. So by just letting it go, it has a positive impact on the combined ratio.

Thank you, Ivan. Can we move to the next question, please?

The next question is from Iain Pearce of BNP Paribas.

The first one is just on the capital generation guidance for the full year. So obviously, you've done 5 percentage points even if we sort of normalize for the positive cat, that still puts you in the range for the full year guidance already. So just trying to understand why the sort of implication is for very low capital generation guidance for the remainder of the year. Obviously, I understand the seasonality in it, but just trying to understand why we shouldn't expect much for the remainder of the year.

And the second one is just coming back to this point on the call option. I'm not sure the question was fully answered, I understood the answer. Can you just confirm if there is an adjustment for the dividend in the call option with the implication being if you are going to call it between now and the strike date, why you wouldn't have called it before going ex dividend? I just want to understand that. I wasn't entirely clear.

Yes. So on the net capital generation, you're right to note that 5 points is at the top of the range of 3 points to 5 points, but part of it was the low Nat Cat activity in the first quarter. And so we would not change our view on the full year, not knowing what the Nat Cat result would be for the rest of the year. And then on top, there's always some seasonality in the capital generation anyhow. On your second question, you're correct that there is no adjustment to the dividend and the fact that it got ex indeed would be considered.

Thank, Iain. Can we move to the next question, please?

The next question is from James Shuck, Citi.

Yes. Many of my questions have been asked, but I had a couple left, if I can. I guess on the call option, I'm just trying to understand the financial logic of what you just said because if the call option is going to expire in about a month's time, and it's just got to exit on a very healthy dividends, then for all intents and purposes, it looks like you're not going to exercise that call option.

But will you allow to sell the call option in the open market? So that's the first question. And then secondly, my understanding of what's happened in terms of the sort of buffering and the increase in resiliency is that you kind of moved about EUR 300 million out of the risk adjustment into the best estimate liabilities. That's one reason why the risk adjustment has gone down despite the very healthy level of new business. So my question kind of is what has that done to the confidence level in each, because you've been steadily moving up the confidence level on the risk adjustment. I think it was 77.5% to 82.5% at full year '24. So presumably, that has come down. And if you move EUR 300 million into the best estimate liabilities, what has that done to the confidence level there?

So yes, in the first quarter, we decided that the resilience of our balance sheet was our priority, and it was a conscious decision to not exercise the option and rather put EUR 300 million into our best estimate liabilities.

On your second question, yes, you're correct in increasing the EUR 300 million into the best estimate liabilities. It was compensated by a reduction in the risk adjustment, which again was reduced by the amount of buffer that we chose to build in this quarter. In terms of the confidence level, we would evaluate that again at the end of the year, but it's given as a range, and that range is actually decently wide in terms of monetary value.

I see. And you weren't able to sell the option on the open market, correct?

No. I mean I think we're not day trading the options, no.

Yes, not quite what I meant. But if this is a value in that call option, then it would have made sense to sell it before when a exit is. Isn't it?

Yes. But what I'm trying to say is there are many considerations that go into that decision that what you're suggesting is not as easy as you make it sound in the sense of the complexity of it.

Thank you, James. Can we move to the next question?

The next question is from Darius Satkauskas, KBW.

Two questions, please. The first one is, are you able to provide gross written premium growth year-on-year in the first quarter in both P&C and Life & Health segments? And the second question is, would you be able to give us sort of the moving parts for the numerator and denominator in terms of Solvency II? I think the Solvency I ratio increased by 5 points. What changes did you see in the numerator and denominator? And how much -- how many solvency points did the EUR 300 million contribute?

Yes. So I -- we don't communicate anymore on GWP. So unfortunately, we won't be able to answer your first question. On your second question, we would only communicate first half on the split between own funds and SCR.

Thank you, Darius. Can we move to the next question, please?

The next question is from Ben Cohen, RBC.

I had a couple of questions on the Life & Health division. Could you give us a bit more color about the growth that you saw in the new business CSM. It looks like you're kind of well on track probably to beat the sort of the outlook that you've given there. And the second question was just on the negative cash flow in Q1 in the same division. I think you reiterated that you're going to get to a neutral position for the full year. Could you just talk us through where that delta is going to come from?

Yes. So on the new business CSM of Life & Health, we said repeatedly that on the financial solutions and longevity, it's lumpy, and therefore, it fluctuates from quarter-to-quarter. The good result in terms of CSM was protection and longevity. So we were able to transact a significant notional on U.S. longevity, and that was the reason for the good result in new business CSM in Q1. And then on the cash flow, I would say this is a relatively small number, and we would say broadly neutral, and it's in line with expectations. And we stick to our commitment of 2026 of reaching a neutral cash flow in Life & Health.

Thank you, Ben. Can we move to the next question?

Next question is from Vinit Malhotra, Mediobanca.

Yes. So I'll come up with 2 questions. One is on the April renewals. I mean, so it seems that from reading the presentation that your property cat exposure has gone up or property cat premiums went up, about 4.6 points mentioned here. Specialty lines where you had on the diversifying lines seems to be a bit worse. I'm just curious, most of the cut seems to be in U.S. casualty or casualty and motor. Is that a correct reading?

And could you just give a bit of picture on the rationale behind these moves? Also in the context of the current conflict in the Middle East, is there some hope that some of the specialty lines demand improves over time over the next renewals or over the next period of time? So that's on the business side.

And just -- I'm sorry to pardon my ignorance, please, but the EUR 300 million buffer, how should we simply read it? Is it -- has there been a benefit to the Solvency II from this EUR 300 million? I mean, how should we easily say that this is the benefit of this number because it's clearly not the prudence building you do every quarter, as you mentioned? And it seems to have affected positively the EOF. How should you like us to read that number, please, if you don't mind clarifying again?

So Vinit, I'll answer your first question. On property cat, the growth we achieved was mainly out of the U.S., where we still see the price adequacy as attractive, sort of in line with what we saw January 1. For the Asian renewals, which is another big part of the April 1 renewal on the cat side, there, our overall exposure was mainly flat because the price decreases were reaching basically a level where price adequacy was just breakeven in our view.

So that's what happened on the property cat side. On the other lines of business, we did have a significant reduction of U.S. casualty book renewal on April 1. You have to keep in mind that it's a very small renewal. So dominated by just, let's say, a few renewals where, again, our view of price trends and price decreases led us to take some underwriting actions and reduce our exposure to these portfolios.

On the specialty lines of business, it was, I'd say, a very line of business specific and market specific. We saw a growth opportunity on the credit and surety side, mainly coming from India, where we're one of the market leaders of that segment, and we can through our terms and conditions and our pricing. And so there, we see the attractive opportunities. On other lines of business like marine or engineering, the market was more competitive. And there, we slightly reduced our portfolio. So that's the result -- what you see here is the aggregation of all this together.

Which also Vinit answers like your 2.5 question, whether the Middle East might have an impact on some of the specialty lines. So we cannot really see. Jean-Paul, any impact on marine and aviation? We're waiting for it.

Yes, so far, there's been no impact on the April 1 renewals. We'll have to see as Thierry mentioned, the losses that people are forecasting are mainly coming from affirmative well coverage. So that market has reacted. But the other lines of business, not so much yet.

So Vinit, on your second question, if we had not added this prudence, then the solvency ratio that we would have printed is 225%. And so that means that we -- for future shocks, we have these 5 points available, and that's why we insist that this improves the resilience of our balance sheet.

Thank you, Vinit. Can we move to the next question, please?

Yes. [Operator Instructions] The next question is from Michael Huttner, Berenberg.

Just 2. One is on Life and one is on the CMD. So the Life growth, I know one of my peers said it was strong, but I'm still thinking it's quite weak because you came from such a high level in the past. When are we going to see the ramp-up of growth that we were hoping for? Because I think you were switching from mortality to other lines. Yes.

And then the other question is on the CMD. You said the next CMD, when is it, please?

On the second question, it's in December 4.

December 4.

Beginning of December. Sorry, Michael, sorry to everyone. It seems the date is not yet fixed. But yes, very beginning of December. Sorry for that.

Okay.

So Pilar, over to you for the Life & Health question.

On the first question, Michael, yes, our teams remain fully focused on delivering the plan in both protection and nonprotection line of businesses, therefore, longevity and financial solutions. In Q1, we've seen that we had a good new business CSM generation, which is coming across all the regions, including protection and as well a good success on longevity strategy.

You know that longevity and FinSol are lumpy nature transactions by definition. In any case, it's difficult to predict the execution, but what I can say is that we are very confident by the current pipeline of deals that we have, and we have still 3 quarters to make it happen.

And I was just surprised that you mentioned protection because I thought protection is a bit where you were reducing and it's actually growing.

Protection keeps being a core line of business to us, but I can say we are being very selective. We have our preferred line of businesses depending on the different geographies, and we are pricing case by case according to our disciplined underwriting policy.

But you have a good memory, Michael, because when we introduced the new business strategy in Life & Health in '24, we had as one measure, minimum hurdle on the profitability side. And we expected as a result of it to lose some of our new business due to that hurdle. But actually, Pilar and other members of the Life & Health team have been fighting tooth and nail to keep the business, and we're actually able to keep almost all of that business, which explains why actually on the protection side, we have not seen the reduction that we thought we would see.

So we are actually pleasantly surprised to keep the protection business at higher margin. Most of the growth, however, in the next years will be clearly from Longevity and Structured Solutions.

Thank you, Michael. Can we have the next question, please?

That was the last question. So I turn the conference back to you for any closing remarks.

So thank you very much, everyone, for attending this call. The Investor Relations team remains available for your follow-up questions. So please do not hesitate to give us a call. As a reminder, SCOR will release the Q2 '26 results on the 30th of July with a call as usual, at 2:00 p.m. CET. And with this, we are wishing you a very good afternoon. Thank you.

Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.

Ladies and gentlemen, the shareholders, welcome to everybody. I am very pleased to be welcoming you here today for the shareholders' meeting at SCOR that I have the honor of chairing again. Thank you for being with us. We are extremely attached to your loyalty, and I recognize a certain number of you from last year's shareholders' meeting. Your help is extremely precious to us. The general assembly, the shareholders' meeting is a privileged moment. It's a dialogue between management, to the Board and to the shareholders. We whom we appreciate greatly.

I have the pleasure of having next to me the CEO, Thierry Leger. He's going to give us a somewhat detailed presentation about our business, where we are, where we want to be. And I would also like to welcome the members of the Board of Directors who work alongside me as well as, obviously, the chairs of the different committees who will be talking to you about the work that they do. I am also very happy to be welcoming 2 candidates for new Board Directors if you approve them. Without any further ado, let us open this general shareholders' meeting. And excuse me for the somewhat official side of all of this, but I have to declare this meeting open. And we are going to now choose the bureau.

The 2 shareholders with the greatest number of votes and who have accepted to carry out the functions of tellers here today are Ann-LaBenettau from MalacoMederic and Thibault Monde from Cova. Thank you very much to both of you. I suggest that as the Secretary of this assembly, Madam Claireeugal Robinson will be -- she is the General Secretary of the group, and she is the Group Chief Corporate Officer. So the bureau has now been constituted.

And I would remind you that as with previous years, this shareholders' meeting is visible live on our Internet website, and it will also be available on the other websites of SCOR. We have non-shareholders who are present here today, journalists, for example, this assembly, of course, being a general one, an open one. In the case of the shareholders' meeting, you are free to speak for questions and for answers. This freedom of expression is also to be seen in the respect of the legal framework, the rights of the press -- duties of the press concerning slander and other elements, whether it be people from SCOR or any other person who takes the floor here today.

We also have someone who has been mandated by us to guarantee that all goes well in this auditorium. And the debates will -- can also be heard in an adjoining room where the participants may also take the floor should they so desire to. The number of shares represented 126,755,901 shares, which represents about 77% of the shareholders who have a right to vote. And we will mention that again when we talk about the resolutions. We have 2 series of resolutions in this meeting. We have 1 to 20.

They are ordinary resolutions and the extraordinary resolutions are from the 21 to 36. The -- for the ordinary resolutions, they must be adopted with a majority, the others with a simple majority. The -- you have seen with with 70.89% of shares represented here today, we do have a quorum so that this shareholders' meeting, ordinary and extraordinary may be declared properly constituted. We have a certain number of -- a certain amount of information that was made available here to the shareholders and score. All of the documents stipulated by law are to be found on the bureau.

We have the present list of attendees. We also have the invitation to the meeting. We have the text of the different resolutions that have been proposed by the Board. We have the Board's report. We also have a document of the URD. the company's management report in which there is the report on governance, on durability as well as the reports and the certificates from the statutory auditors.

In compliance with Articles R25 of the Code of Commerce, other documents such as the results 2025, the social balance sheet and the ESC information, the Articles of Association of the company, also the list of the nominative shareholders appointed on the 16th day before the meeting, the information on social capital as well as all of the information that relates to the candidates who are being put forward or for the renewal of directors and to the function of the statutory auditor.

Thank you very much, Claire. By way of introduction, I would like to just very briefly talk about SCOR's situation. And then, of course, Thierry will be coming back to talk about that.

In 2025, I think that we can say that SCOR had a very robust performance, which was based on a lot of discipline. It was a decisive stage in our Forward '26 strategic plan with remarkable financial results because the net results of EUR 855 million is the highest that SCOR has ever seen. All of our activities helped in obtaining these figures. You can see 3 main indicators here that are essential for any reinsurance company. The solvency ratio represents the group's capacity to confront any situation that arises, even situations that are extremely turf. And this solvency ratio has increased to 215%, which is in the upper echelons of the -- our range, which was between 180 and 200 -- over 200.

For the -- at constant economic rates, we have an economic value that is up 13.7%. And the equity yield is 19.1%, which is, in turn, also greater than our objective of 12% in forward 2026. Quite apart from these figures, what appears very clearly is that the actions that we did were extremely relevant and helped us to ensure in a durable fashion, profitability since 2023.

The solidity of the group is not something that has occurred per chance. It is the result of the very deep changes that have been undergone by the management and the Board in an environment that you're familiar with, which is volatile, which is demanding, 3 activities, non-life, life and investment are showing today very satisfactory performances that are fully in line with what we expected.

These figures also show us how strong our franchise as a worldwide reinsurer is. The fact that our SCOR's expertise is recognized, the expertise of its employees is recognized, the relevance of our risk diversification policies, which is essential in our business model. It shows also that there is trust in us for the future. I'd like to mention something concerning SCOR's governance, which has fully played its role in this performance in 2025. Recent developments that have occurred in the Board that you approved over previous years, I believe, have truly strengthened the complementarity of the skills of the Board and the richness of the strategic debate that we have always wanted. p

This diversity of profiles has made it easier to have a harmonious undertakings in the Board meetings and all of the directors are carrying out their mandates in a very serious and disciplined fashion. And I would like to take this opportunity to warmly thank them for all that they do for us, particularly the chairs of the committees who have an essential role to play in the functioning of our governance and in the preparation of the decisions that are taken before the Board. I would also like you to be able to show your trust in the 4 new directors, 2 who are going to -- who are asking for their mandates to be renewed and 2 who are wanting to become directors. Madanessa Marquette when she talks to you about the Compensation and Nomination Committee, will talk about that later.

You have probably understood that all forecasts are positive. SCOR is in a very good position to continue to create value for its stakeholders, and this value creation is one that we share with you, our shareholders. This reflects SCOR's engagement to offer a sustainable value to all of its investors. It also bears witness to the confidence that we have that the group is resilient and that we are able to share the growth of our economic value with you. All of this leads us this year to be offering a dividend that is up by -- of EUR 1.82. That's an increase of 5.6% over previous years.

You know that the principle of our Compensation Committee is that it aims to give you a stable, predictable dividend, and it defines a floor level that today is EUR 1.90 as soon as the group's financial situation allows it to do so. We are able today to move forward into our next stages with even more serenity. We are fully aware of -- we're focusing on the finalizing of this current strategic plan, but management will be at the end of this year 2026, coming up with a second strategic plan. This process has already begun.

We have a very coherent and transparent dialogue between management and the Board. And it is, of course, the Board that will finally be accountable for approving the plan. Our activities must be long-standing ones. We want our plan to come up with performances that are there to stay. The score today represents stability, good performance and the alignment between our strategy, our organization and our reason for being is extremely clear. This is even more important today because of all that is happening in our world today. I'm not teaching you anything when I say that we are in the throes of great changes in the world and changes that are occurring more and more rapidly and more and more urgently.

Of course, there is the conflict in the Middle East, one war seems to take over from another. Tensions rice. AI is giving rise to problems even if it manages to solve a lot of them. But all of this extreme simultaneous development of risks and the fact that they are heavily intertwined is making our society very volatile. And today, I think this highlights an essential challenge for us all, and that is to be able to anticipate risk, to understand risk, to be capable of confronting these risks when they occur.

And in this context, the role of reinsurance has nothing left to prove. It is uniquely capable of diversifying over a universal basis. It can observe -- absorb shocks. -- it remains an essential pillar of economic and societal resilience. SCOR will be fully playing its role here with humility, but also with determination and a feeling of responsibility. We are a world-renowned reinsurer. We are here to try to cope with these great challenges.

We are -- that is fully in line with what we say, the art and science of risk. We want to make sure that we contribute to protecting companies and rendering them more resilient. The multiplication of risks once we have the capacity to actually understand them and to master them, thanks to our experience, our rigor and our diversification is an opportunity for SCOR. So we fully believe in the future. We are going to be listening to several of our stakeholders. We have listened to them, and we know that trust and score is there. It has been revitalized. Dear shareholders, I would like to thank you for your very precious support.

And I would now like to give the floor to Thierry.

Thank you, Fabrice. Good morning to you all. Delighted to be with you here once again, fourth time since my appointment 3 years ago as CEO of SCOR. 2026 is a pivotal year for SCOR. It's the last year of the strategic plan Forward 2026, also the year during which Fabrice mentioned will be defining the new strategic plan for the years 2027 to 2029. I'd like to begin by reporting on the progress achieved on the current strategic plan. So a plan that involved 2 things.

On the one hand, value creation on the other, modernizing the SCOR platform in order to shape the reinsurer of tomorrow. And as Fabrice mentioned, all that is consistent with SCOR's purpose, which is to protect societies. Let me begin with value creation. And here for the objectives, let's say, the financial targets for 2025, as Fabrice mentioned, net income of EUR 851 million was a historic result for SCOR value creation, increased economic value of the group is at almost 14% at constant exchange rate and constant interest rates, excellent result.

The target was 9% growth, and I was very clear that those 9%, I always considered that as the most challenging objective to meet by SCOR. So to be at a level well beyond 9% is a demonstration of the quality of our results. And all activities have contributed to that. P&C with a combined ratio below 87% Life with a technical result of EUR 450 million, so above the target of EUR 400 million. And once again, we have a stable and very positive result from our investments. But this performance -- okay, let's put this 2025 performance into perspective.

Shown on this chart that you saw last year, you see the performance for 2025. You see the technical and financial results contribute similarly very strongly. Also see the technical result for 2025 sleep slightly lower than 2023 recognized as an excellent year.

Let me remind you that in 2025, we strengthened the resilience of our reserves. So we created buffers. So if I add to the buffers that we set up in 2025 to the technical results of 2025, they'd be far higher than the 2023 results. So excellent technical and financial results delivered in 2025 on a over a 13 or even 20-year period and the return of 19.1%, as Fabrice mentioned, which is excellent. Turning now to the balance sheet. We've invested a great deal in these past few years in the strength, the solidity of our balance sheet with a solvency ratio of 215%.

We're at the upper end of the range that we set ourselves as a target. Second point to note is the increase of the 5% ratio. That is we've created 5% capital in 2025. That's well above the 1% to 2% that we set ourselves as a target in the Forward 2026 plan. So on the basis of these very solid results, strengthened balance sheet, but also the activities that are operating very well. We've taken 2 decisions. Firstly, we've increased in 2026, the value creation target, which was 1% to 2% in the strategic plan, and we've increased that to a 3% to 5% rate.

We took another decision on the management front to recommend to the Board, as Fabrice mentioned, a dividend of EUR 1.9. And you'll also note that these EUR 1.9 are the new floor. And as you know, the new capital management provides for this ratchet effect, EUR 1.9 is the new ratchet of the dividend. Once again, it's proof positive of the solidity of our results, but also of the group's outlook.

Other component of our strategic plan is to shape the reinsurer of tomorrow to modernize SCOR's platform. I'd just like to report to you on some quite remarkable items. We've achieved savings of EUR 170 million over the period. The target was EUR 150 million over 3 years, and we've exceeded that target, and we continue to improve the group's operational efficiency. We've also overhauled our processes. When I arrived, we have over 900 processes across the group. And most of these processes were manual, not very automated. We've overhauled each one. We've reduced them to less than 500 or indeed less than 400.

Of course, that's a long-term effort. We're going to digitize them. We're going to automate them and improve the quality and efficiency of these processes. We've also created a center of excellence at Bucharest. That's a novel TFA score that's never used the possibility. Well, the idea of Bucharest is to internalize hundreds of positions. These are positions that are currently outsourced. So these are outsourced staff that we're going to internalize at Bucharest and also combine a number of teams that are scattered throughout the world. We're going to locate them in Bucharest. So these teams in Bucharest once again allow us to improve our efficiency and to better harmonize our internal processes and improve our operations.

Final point I meant to mention today is, of course, we've made progress on the tech and data front. And we've above all created our own data platform called Genesis for those of you who like the band. I don't think it was a reference to the band, but it's the genesis of something new and fundamental for the group. So the Forward '26 plan has defined 4 pillars in terms of operational excellence, where we want to create operations that are far improved over what they were a few years ago.

We strengthened capital allocation in order to allocate capital in a far more dynamic manner. We've better leveraged SCOR's leading franchise with the partners who contribute to our risk. We've improved our asset liability management to move from a somewhat static ALM to a more dynamic ALM. And of course, as I said, we've improved processes and data management.

We've made great progress across these 4 pillars. I can promise you that by the end of the year, we'll have met all our targets for these 4 pillars. So as you'll have understood, SCOR is a reinsurer that is data focused, data based. And so for us, it's important to seize opportunities offered, for example, by artificial intelligence. So we created our own data platform, Genesis led us to set up specific ALM platforms, for example, that was rolled out a few weeks ago. We've set up specific platforms for P&C, for life and health, also for sustainability.

We've also set up a module for everything that involves data retrieval. You can imagine that when a client submits a new risk, we receive up to 15 different files PDF XL work, that retrieval is always long, cumbersome manual. And thanks to this module, thanks to AI, we're now capable of retrieving these data automatically. So it's a remarkable time saver. We also looked at the contracts. The contract is our product.

We've invested a great deal in contract. We're digitizing our contracts in order to transform the contracts from a piece of paper into data that we can use in order to improve the quality of our policies and our commitments. So these are our 6 flagships that were putting the finishing touches to this year. I'm often asked about productivity efficiencies. People say, Mr. Leger, where they are, they will no longer need underwriters tomorrow. So we've addressed this question very closely, and I'm very optimistic, very excited by AR. But I don't think SCOR is going to benefit specifically from huge efficiencies. There will be increased efficiency, yes, but the real opportunity, a big opportunity for SCOR are economies of scale. So to maintain our employee base about 3,500 and 4,000 people in the coming years, but to sharply increase our business volume, thanks to all the modules that we're setting up allow us to write more business with the same number of employees.

So it's the productivity of SCOR will stem not from cost savings, but from economies of scale. So here's a tangible example and you want to read the details. I mean it's -- you shouldn't be able to read the details, but it's a real example of a module where we have used AR in our core business, and it's really there where I see the greatest potential for SCOR going forward. So here, we have augmented underwriting. This allows us through the various modules that we've already crafted to set up a cockpit for an underwriter.

Imagine an underwriter sat in front of his screen. He clicks on new risk that he's received that's a priority. Immediately, the cockpit opens up by qualifying the contracts, the risk gives you an idea in a few seconds of possible pricing and commercial approach for that particular risk. These pilots already exist at SCOR. Some are already being commercialized, and that's where there'll be huge progress at SCOR in the next 1 or 2 years. I can tell you the teams are very excited by the possibilities that this will offer to achieve these economies of scales that we will be able to benefit from tomorrow.

So as I said, SCOR for us, everything we do is profoundly rooted in our purpose, combining the art and science of risk to protect companies. SCOR is a responsible player in 2025, we've achieved all our sustainability targets, societal targets that we set ourselves. Augustin de Romanet, Chair of the Sustainability Committee will report on that later. We also help our clients to evolve in this transition. That's not always easy, specifically in the current geopolitical context. We seek to find solutions to emerging risks and requirements to be a long-term partner of our clients. to which SCOR is very closely linked, that is to this transition. Here again, we've set ourselves some very clear objectives.

In spite of all this, we've had to react to a geopolitical context that has worsened over the past few years. We have companies that are facing geopolitical risks such as a war that are facing an energy crisis in Europe, where we're seeing a realarmment and a fully fledged energy crisis. So we have set up an ethics and sustainability committee. That was a committee that we established at the beginning of the year that's always already held several sessions, one on rearming Europe and how SCOR can in a responsible way, support that realarmment to give our underwriters a clear plan, a clearer frame for underwriting these risks.

We also focused on LNG, liquefied natural gas, especially in the energy crisis currently affecting Europe. And here, we sought to develop a clearer framework for underwriters who today are somewhat overtaken by events to set out a clearer frame in order to write and support business to ensure energy security for Europe. And I see -- feel like -- I feel like kind of a bit of a tight rope walker here. It's all about balancing, on the one hand, the interest of climate, sustainability, balancing those with the reality of geopolitics, and it's not always an easy task, but I can tell you that S is acting responsibility, and we seek to find the right solutions to those challenges.

Before moving to the new strategic plan, I'd just like to come back on the final year of the strategic plan. That's to say 2026. Shown here on this chart behind me is, in fact, the price, the cost of capital. You see the 3 lines of 3 of our peers. And across the top, you see the line of SCOR. You see the cost of capital at SCOR these past years was far higher than the cost of capital of our peers. So I tried to think about how I could explain the problem. I'm not very good at this, but if you like hurdle races, you got your peers, I mean, they're down here and where above a hurdle. So those who are going to clear the highest hurdles will lose the race.

So it's absolutely paramount for SCOR to reduce this cost of capital, and that was at the heart of the strategy forward in '26. So we've made some progress. At one point, we were above 25%. Now we're below 14%, but there's still a gap with our peers. So 2026 and in the coming years will continue to see us creating greater confidence with our investors, and we'll do that by reaching the objectives regularly over the coming years. 2026 is also a year of heightened competition in P&C.

We've understood that we're not the only reinsurer in the world that has experienced attractive profits in these past few years. That creates a greater capital base for all reinsurers throughout the world who are capable of offering increased capacity to insurers. This means that the offer has increased these past 3 years, has outstripped demand. So prices are under pressure. And SCOR has readied itself to this environment. We've defined very clear strategies by line of business, and we allocate the capital very dynamic to these lines of business to achieve the best results.

What we seek to do is through this strategy, to leverage our Tier 1 franchise with as an objective at every renewal, try and do a bit better than our peers, a bit better in terms of volume and a bit better in terms of the technical result. What we -- that's -- we've proved that over the past 18 months. Every time we had slightly better volume than our peers with an improved technical result.

And over time, this will lead to a better return for the group going forward. For 2026, SCOR employees are fully cognizant of the challenge to deliver the targets promised in 2026. So just give you a glimpse, no more than a glimpse of the new strategic plan. You have to know wait until the end of the year to discover more. But in fact, there are already 2 key components in this plan. The first is, as I said, and I'll repeat it, to continue to deliver quarter after quarter the results and to reduce the cost of capital for SCOR. It's very important to continue to work on the excellence of our operations, but also our business.

Second component of the new strategy will to benefit and leverage Scores modernized based in order to deliver targets that have been defined and to deliver even more ambitious objectives in the coming years.

[Presentation]

Thank you very much, Thierry, for those very encouraging words. And I think now that it is up to Vanessa Marquette, who is the Chair of the Nomination and Compensation Committee.

Shareholders, it's my pleasure again this year to tell you what we have done in the Nomination and Compensation Committee that I preside over. As you know, this committee is the result of the merger of the Compensation Committee and the Nominations Committee that was decided 1 year ago by the Board.

So I will be covering in my report all of the subjects that were previously covered by these 2 committees. But I will, however, be brief because extremely detailed information can be found in the URD and also in the invitation to this shareholders' meeting. First of all, let me just very rapidly tell you what we have done. The -- first of all, the committee and the Vice Chair of the Board, Vice President of the Board have decided in 2025 to call upon an external assessment of the Board, and this was given over to Egon Zehnder, a consultancy firm. I'll tell you of the results of that, that were extremely positive.

The committee also looked at the composition of the Board and looked for 2 new directors, independent directors who could follow on from Augustin de Romanet and myself because we will be leaving the Board in 2027. We propose that the first candidate, Jean-Francois Lois, be appointed this year. He is present with us here.

The second candidate, Antoine Vignial, who's also in the room today, will be put forward before the shareholders' meeting next year. Changing the Board also means that the committees have to change in their composition. So apart from their composition and their size, the committee also looked at the different succession plans of their respective chairs. The committee also looked at the compensation of the CEO when as his Thierry Leger mandate will be renewed, an increase of 10% of his package is proposed before you today. The committee has also recommended that the interest of the Chair of the Board -- the Chair of the Board and the Directors be aligned with those of shareholders with an increase in the share remuneration that is distributed. Let's begin with the assessment of the Board. On Egon Zehnder decided, assessed that the compensation organization and functioning of the Board was good. They had already done an assessment in 2022.

So the conclusions of this assessment were prevented before my committee as well as before the Board, and you can read the details of that in the URD. Basically, Egon Zehnder say that there have been very positive changes since 2022. The administrators -- the directors are satisfied with the functioning of the Board and the committees. They appreciate the very demanding and structured governance that has been set up under the ages of the Chair.

All of this met with their unanimous approval. Egon Zehnder has also recognized the action that has been taken by the CEO and the quality of relations with the Chair of the Board and that are based on transparency and trust. They have also welcomed the quality of the Board's work and the work of the committees that are based on the competence of newcomers and their expertise in a lot of insurance and reinsurance fields. Without calling into question this very positive appreciation of the functioning of the Board, there are still possibilities to improve things. For example, planning successions -- the committee has been particularly focusing on this over the last few months or strategic discussions within the Board, which could benefit from the organization of a second annual strategic seminar or supervising risks or preparing crisis scenarios that could give rise to simulation exercises.

We won't -- we will continue to keep you informed as to what we decided to roll out. Let's look at the composition of the Board. This year, there are quite a few mandates that are reaching terms. Holding Malakoff Humanis, represented by Thomas Sonier has decided not to ask for a renewal of the mandate because for the lack of availability. My committee would like to warmly thank Thomas for his contribution, which is always an excellent one to the work of the Board. The relations between SCOR and Maneroffeimanes are excellent. And I would like to say to congratulate the fact that -- to welcome the fact that one of their representatives is today a teller in this meeting.

As with the other mandates that are reaching term as well, we have other proposals. First of all, the mandate of Thierry Leger, CEO, will be renewed for a period of 3 years. The mandate of Adrian Cou, who is the Chair of the Risk Committee, will also be renewed for 3 additional years during which he will remain independent. Augustan's mandate, Vice Chair and Chair of the Sustainability Committee and my mandate will be carried over for 1 further year at the end of which we will cease being independent, and we will leave the Board.

During the last year of our mandate, we will be able to organize our succession at the heads of our respective committees. And lastly, Jacques Grain, who was appointed center in 2025, will be appointed a director for a period of 3 years. Jacques Grain is the Chair -- the President of 2 great listed companies, and he's a direct Board member -- Board Director of another, but he will very shortly be leaving that mandate. external mandates that had no incidence on his engagement within score, he'll be able to give more time necessary to carrying out his functions. In order to succeed to August and myself, the committee will be calling upon -- again, upon the consultancy firm, Egon Zehnder.

The mandate will be to look for 2 new Board Directors. One has to be a person who is recognized in the world of business with a preference for insurance and reinsurance. And the other will have to be an experienced lawyer, legal expert with a lot of expertise in corporate law. Amongst the candidates presented by Egon Zehnder, 2 have been selected by this committee and also by the Board. The first is Jean-Francois Lois, former Manager of the SFSA and of Natixis Insurance and of the BPCE Group, of which he was the CFO. Jean-Francois Lois will be joining us this year for a first mandate of 3 years.

The second is Antoine Vignal, a former lawyer partner in the Gen Fresh Fields firm, Antoine Vignard joined the Saint-Gobain Group as a General Secretary and member of the Executive Board. He will be joining SCOR's Board next year for a first mandate of 3 years. With me nomination of Jacques Grard that will offset the departure of Thomas Sonnier and the recruitment of Jean-François Lois, the size of the Board will temporarily be 15 members, but it will drop back to 14 next year because I will be leaving and Augustin de Ranier will be leaving and Antoine Vignnard will be joining us. The Compensation and Remuneration Committee -- Nominations Committee and the Board then picked up 2 other subjects, the composition of the committees and the succession plans for their chairs.

In order to integrate Jean-François Lois to prepare the future, the Board decided upon a proposal by the committee to carry out the following changes. Jian Coty will give up her seat in the Audit Committee. Patricia La Cost will leave the Audit Committee and join the Risk Committee. Duana Palicieard will leave the Risk Committee to join the Sustainable Development Committee. And lastly, Jean-Francois Lois will join the Audit Committee and the Committee for Nominations and Compensation and will also be a member of the Strategic Committee.

Following on from these changes, the size of each of the committees will be 8 members per committee with the necessary resources to ensure their chairmanship in the future. Let's move on now to compensation. I will just give you the main information and all of the other details are to be found in the document, Mr. Brochure. As with every year, -- the Board has put forward 8 resolutions, 3 ex-post votes on 2025 compensation, 3 ex-ante votes on the 2026 compensation and 2 votes on the allocation of performance shares and stock options.

Let's begin with the 2025 compensation. That of the Chair of the Board is the same as the policy that was approved by the assembly, a fixed amount of EUR 600,000 to which is added to the compensation for a director of EUR 143,000 determined by applying the compensation policy of the directors as well as the normal advantages for adviser assistant and a shared bureau and car.

The Chair, similarly to other directors does not benefit from any variable compensation that is a function of SCOR performance as in line with the recommendations of the AME. It is not the case of -- that's not, however, the case for the CEO. His bonus depends directly on 3 financial criteria: the return on equity, capital and the controlling of management expenses. To this, there's also another criterion that is added that of leadership with a ceiling at 100%. SCOR's performance in 2025 is exceptional to such an extent that the success rate of the bonus is 120.6%, which is a strikingly high figure after 2024, which was much more morose.

The committee and the Board are delighted that they are, therefore, able to reward the performance of the CEO, delighted with the operational and financial results that ensued. A lot of structural reforms have also been set up since our CEO has arrived and the leadership criteria has thus been reached and that is 100%.

Let's move on now to compensation for 2026. We had decided to keep the same performance conditions and the appreciation ranges for the forward 2026 3 strategic years. Only the targets have been updated that the bonuses reflect the plan's objectives for 2026 with a hopes for ROE of 13% or more with capital intake expected at around EUR 300 million and a decrease in costs, a decrease of EUR 1.239 million, to which you can add an envelope for projects of EUR 56 million, which gives us a total of EUR 1,295 million. These conditions are also go also hand-in-hand with performance shares such as they have been looked at for 2026, '27, '28.

The financial targets cover '27 and 2028 in the next strategic plan. And in operational plans, we -- for ESG, they have also -- the targets, they have also been renewed with a highly ambitious objective of having 38% of women within the senior categories of management by the end of 2028. We also have the mechanism of neutralization and the super performance or underperformance. We have criteria that are attached to that as well. And since his recruitment in 2023, TL's wage packet has not changed. It seems relevant to the -- a good idea for the committee and the Board to propose an increase of 10%, which would be consistent with market standards and is a reflection of the quality of his profiles and the results he has obtained.

In order to do this, the committee and the Board have decided to increase by 20% the number of performance shares attributed to the CEO, which represent more or less half of his remuneration. This increase, which has established the level of remuneration for [indiscernible] for the next 3 years as well as the performance conditions and appreciation scales are looked at next year when we adopted the next strategic plan. Let's take a look now at the compensation plan for the directors of the Board. As you know, there is a difference between the compensation envelope of EUR 2 million and the policy itself, which is a distribution key to the envelope. The committee and the Board are not asking for an increase in the envelope despite a temporary move to a Board of 15 members, and we will still have the amount of EUR 2 million. And despite the fact that EUR 2 million seems to be insufficient to properly remunerate the directors for the amount of work that they put in 2023.

So the 2025 policy is carried over into 2026 without any main changes, which means that the invested part in shares will increase from EUR 10,000 to EUR 20,000 per year for the directors. In the same spirit, the Chairman will be receiving a sum of EUR 50,000 per year invested in shares. There too, this increase of around 8% of his package aims to strengthen the alignment between these interests and the interest of the shareholders. And to end, let me just talk about some of the normal resolutions that allow the Board to actually distribute share performance shares and stock options to the management and the employees of SCOR. We are proposing to allow the Board to attribute new shares or existing shares there where they are granted authority to do that, whereas they did not have it in the past. This change, hopefully, will ensure that SCOR will be able to continue with its excellent finances and excellent solvency levels. Thank you very much.

Thank you very much, Vanessa. It's also always a very tricky thing to do when we start talking about the nominations and compensation quality. And I think your presentation was extremely clear. You probably saw concerning governance and the composition of the Board that we are also trying not just to anticipate risks but departures as well. And I would like to thank Vanessa and August for having accepted to delay the departures by traditional year. It's not a normal way of working. It's not traditional. But for the last dozen years, they have been supporting the SCOR's actions. And quite apart from the arrival of Jean-Francois and the confirmation of Jacques, we have also anticipated on -- we've anticipated 2027, as you saw with Antoine. And this is something, I believe, that shows that our governance works very well. Thank you very much, Vanessa.

We are also going to be asking you to vote upon the renewal of the mandate of KPMG, our statutory auditors. They are also in charge of certification of sustainability information and the nomination of PwC as new statutory auditors because Mazar, our former statutory auditor has reached the end of their mandate. Before asking the statutory auditors to speak, I would like to give the floor to Augustin de Romanet as the Chair of the Sustainability Committee. Augustin, over to you.

Thank you, Chairman, ladies and gentlemen, shareholders. don't base the quality of the work on the number of slides, far fewer than Vanessa, but we worked long and hard in spite of that. Seven members of committee met 4 times in 2025 with an attendance rate of 96%. I thank all its members for their contribution to the work. Now the emissions of the Sustainability Committee were broadened slightly during the course of the year because they henceforth incorporate dimensions linked to human resources.

Indeed, following the work of assessment of the Board, we discovered that HR issues were not necessarily had the place that they deserved in the Compensation Committee insofar as they did not directly concern compensation. We consider that said matters extremely important for the life of the group needed to be addressed more extensively and could find their place within the Sustainability Committee insofar as they did not directly concern the compensation. Let's start with sustainability.

First topic is preparing the first sustainability report of the group, otherwise known as CSRD report. So in 2025, the committee finalized the review of this first sustainability report we began to review in '24. And this report is incorporated in the universal registration document of '24. It sets out the nonfinancial issues deemed important for SCOR in compliance with new applicable standards. It's a very substantial effort undertaken by the team, both regarding implementation of process as well as production, ensuring reliability of information in compliance with demanding European -- before the directive Omnibus by the EU proposed by the commission, reducing the number of checkpoints.

We had 1,200 indicators to complete. So the teams were under considerable strain to be compliant with these European standards with experience obtained in '24 with first report, the dual materiality continued to be part of our work dual materiality involves, on the one hand, assessing the impact of SCOR on the climate, what's the impact of climate on SCOR on the one hand? And on the other, what are the financial consequences for SCOR of climate change. So it's on the basis of those 2 materialities that we examine what represented for the group's performance and financial strength.

The update in 2025 converts the major risks and opportunities identified in the previous year, and we managed to get our auditors to accept that from the societal standpoint, SCOR's impact was very positive. The Board regretted very much in the previous year that will be deemed as negative, our impact on the group's people. It seemed as totally fanciful, and we had pretty lively discussions with our auditors to get them to accept that SCOR was a standard set in social terms, more about that in a moment. The committee also reviewed the prime components of the group's sustainability strategy and reviewed the changes brought to said policy with the report that we call sustainable business report, all the documents pertaining to sustainability and a very major reference base for rating agencies use that data as part of their CSRD questionnaire.

Lastly, we examined the proposals pertaining to key performance ESG indicators, notably environmental and social that be incorporated in long-term compensation of the CEO by 2027, so much for environmental matters in general. Turning now to human resources. We examined the work aimed at improving the SCOR employer brand that Thierry just referred to. He's convinced as we are indeed, that our ambition in terms of performance, attractiveness and sustainability involve the way we attract and retain our employees. It's part of a profound transformation initiated by Thierry Leger 3 years ago seems to us to be particularly relevant in a demanding and competitive labor market drawn up in 2025 -- this proposal of employer value expresses what our employees can expect from the group and what SCOR seeks to be as employer highlights items where SCOR offers a unique work environment, strengthen its ability to attract and retain talent in this competitive market, an employer that rooted in our purpose, art and science of risk aligned with its priorities in terms of sustainability, HR and a defining landmark for the group because it is even to be found in Paris Metro stations.

Committee also reviewed the principles of the European Directive on pay transparency and its consequences for group practice. The goal was to ensure consistency with -- of HR policies with this new framework with a controlled implementation recourse to what we call global job grading implemented since 1st of January 2025, offering a grade depending on one scope level of expertise is a useful framework strengthens the predictability and equity of pay policy, placing SCOR in satisfactory conditions to effectively apply said directive.

Turning now to our second slide. I promise you 2. There are only 2 on the environmental strategy. So SCOR has 3 businesses, one of insurer, reinsurer of investor to invest the availability of its balance sheet and also organizing day-to-day in these 3 roles, it seeks to reduce CO2 emissions. Firstly, as insurer. SCOR's climate strategy rests on 3 complementary levers that constitute the theory of SCOR change to contribute to reducing greenhouse gases to move to its net zero ambition by 2050 and to have a pathway compatible with the target of 1.5 degrees Celsius.

Let's dive now in the detail of these 3 levers. Firstly, reduce the carbon footprint covering both its underwriting and investment portfolio. Secondly, strategy of engagement with its clients and companies in which it invests. And thirdly, support to the energy transition by rolling out favorable solutions for a low-carbon economy. That's the first section on the screen. We've set ourselves intermediate targets covering each of the 3 pillars of the strategy. Most targets are set out through 2030, consistent with the regulatory requirements of CSRD. 2030 is also a key milestone in carbon intensity reduction trajectories highlighted by the work of the IPCC that serve as a compass for us.

Let's start with underwriting. SCOR had an interim target in 2025 in this regard as a reinsurer. SCOR supports the energy transition by supporting the development of low-carbon initiatives with adapted insurance solutions. First objective shown in green on the screen was to double by 2025 insurance and facultative reinsurance devoted to low-carbon energies. This target takes 2020 as a baseline and gross written premiums in euros indicated achieved, SCOR doubled its coverage in '25 versus 2020.

The next objective was to increase times 3.5, the coverage by 2030, reflecting a longer-term ambition for supporting the energy transition. The definition of low-carbon energies within the group rests on recognized scientific data that of the IEA, IPCC European Observatory for low carbon energy covers production of renewables. Carbon capture and storage or hydrogen. This definition includes the full value chain from equipment through production. This dynamic relies on very strong internal expertise and the entry point.

The new practice entitled New Energy practice supporting development of premium linked to low-carbon energies contribute to making SCOR a leader in the transition to a low-carbon economy. Lastly, still on underwriting activities, our target is to reduce by 23% our carbon intensity of SCOR Business Solutions by 2030 on the scope of European companies, taking 2022 as the baseline year. We lastly decided on engagement with our clients on environmental matters.

On the Forward '26 plan ending this year, this engagement concerns clients representing at least 30% of premiums of SCOR Business Solutions. It's always a bit sophisticated for our commercial reps to convince to attract clients that we sometimes lecture. So we have to emphasize our engagement policy, which is rather counterintuitively aimed at engage with them on issues that sometimes upset them. We discuss ESG transition strategies and tangible initiatives that they undertake to reduce the carbon footprint. This illustrates SCOR's approach, which is a pragmatic approach moving forward gradually with our clients, relying on their own growth and progress trajectories. -- so much for the insurance and reinsurance side.

Now briefly as investor, we seek to reduce our carbon footprint on SCOR's own operations and our other targets for 2030 as investor to reduce the carbon intensity of 55% on equity portfolios and to improve biodiversity. Regarding operations, that is heatings, buildings, air travel, reducing by 50% the carbon intensity of operations versus 2019 and that by 2030, so much for the climate strategy.

Now Thierry Leger's presentation, as what I've just said, illustrate a gradual implementation at this stage, we're in line with all the targets we've set ourselves and indeed sometimes even ahead on a number of them. It needs to be recalled, however, this strategy is a medium and long-term strategy. It's difficult to assess progress year-by-year, especially when it comes to changing underwriting portfolios that can only be undertaken over time. The trajectories are not necessarily linear. They're influenced by the economic and geopolitical context, but also by the maturity of technologies and the quality and access to data that we have to measure GHG.

A long-term ambition is to achieve net zero by 2050 in order to contribute tangibly to reducing CO2 emissions. As I said a second ago, our strategy also extends to biodiversity. That's to say all living materials, natural environments, coral reefs and interactions that connect them to the ecosystems that our societies are based on. Back in 2020, SCOR signed the Finance for Biodiversity pledge with the ambition of contributing via our investments to suffering or indeed inversing the curve reducing biodiversity by 2030, unlike climate change relying on global indicators such as CO2 emissions, biodiversity is based on far more pragmatic fragmented indicators requiring specific responses. SCOR has decided to focus on deforestation, a major factor in the loss of global biodiversity in parallel.

We have target engagement with certain players to encourage them to better factor in their impact on ecosystems. However, in a world that is becoming ever more legalistic, we need to be prudent. We mustn't overpromise and underdeliver. That's why we have to emphasize quite honestly the limitations of a particular private sector action, the delivery of our net zero ambition as well as our commitments in terms of biodiversity depends on us, of course, but also many external factors that are beyond the field of action of our company.

So our commitment is clear, but it's equally clear sighted. Without decisive and comprehensive action by governments, the world won't be able to reach a trajectory of 1.5 degrees. Score won't achieve its net zero ambition or reserve the loss of biodiversity by 2030. SCOR wanted to introduce this disclaimer this year so that each of our shareholders are made aware of the importance of our sense of responsibility and our clear-sighted approach regarding the limitations of our action.

Lastly, beyond the environmental dimension, SCOR has set itself, notably as part of the Forward '26 plan, objectives in terms of inclusion, equal opportude to promote the best talents, both feminine and male and female in governing bodies. So the Executive Committee, the Board has set an ambition of 30% women at the committee by end of '26. It was exceeded at the end of '25. Women represented 33% of the ExCo. And you saw in '26, Exco has reached gender equality. So I'd say mission accomplished.

Now as regards the group top management in order to have a mixed talent pool, a target in '21 was set for the top management of the group, 200enior executives above grade 60, and a target had been set. And in 2025, the proportion of women stood at 33% of that scope, whereas the ambition was 32%, '26. So there again, we've exceeded the target of 32% in '26. We exceeded it in '25. And given that momentum, we've reviewed and revised the ambition to extend it to 34% by 2027.

Lastly, SCOR and to conclude, SCOR ensures that its people are regularly trained on key matters through annual mandatory training. I said that these training session reached a 100% attend -- you'll smile because obviously, mandatory, it's 100% having been in the company in the past where we also had mandatory training sessions where we had to thrash the Eco in September for anyone to attend. I'd like to hail the quality of SCOR's management leading us to the fact that in terms of compliance, cybersecurity, control of operational risks in the 3 lines of defense of AI, data protection, the 100% attendance rate was reached with naturally spread risk control to skills ensures that the headcount matches the requirements. Thank you.

Thank you very much, Augustin. We're going to move on now to the auditor's report. This has been put online, and I would give the floor, therefore, to Jennifer Manry, who works for Mazar, and she will give us the results that have been reached by the statutory external auditors. Thank you very much.

Hello to all of the shareholders. I'm going to tell you about the financial results 2025 for the annual accounts and the consolidated accounts. This year, there have been 10 reports to give to the different -- to this general assembly. The first 4 have to do with the annual accounts for the ordinary part of the assembly, and it deals with 4 different issues.

On the annual accounts of SCOR SE, we have granted a certification without any reservations. We have seen that the adoption of the new accounting regulations is something that covers -- that behholdves all companies. We have this year concerning the -- we've taken a look at the evaluation of technical reserves concerning reinsurance treatment for the assessment of reinsurance premiums and of the different securities.

Now without -- the observation is that without putting into question -- calling into question our opinion, we draw your attention to the application of the new regulation AMC 202206, relative to the modernizing of financial statements, such as described in the 5.1 note of the appendix to the annual accounts. For the consolidated accounts of SCOR, again, certification without any reservations. We have looked at the different items, estimating the insurance liabilities of life and non-life and evaluating deferred tax assets or seeing what has not been whether there are any tax deficiencies.

And the report for the management of the group, we haven't seen any observation of severity or concord or with the consolidated accounts. We have also concerning the durability report on SCOR, we remind of the fact that SCOR has to remain compliant in the matters of CSRD. And we have looked at the scope and the nature of the mission. We have seen that there are no errors of missions or incoherent significances concerning Scope 3 that are linked to reinsurance activities.

I'd like to move on now on the different collective agreements. These different collective agreements that we are aware of, we cannot actually pronounce as to whether they are well founded or useful. In our report, we can see that there are no new collective agreements.

There is just one regulated one that is carried over from 2021, in line with the transactional agreement that was done between Covia and SA and Covia Gap. If we move on now to the extraordinary side of this General Shareholders' Meeting, we have come up with 10 reports for the Board that has to do with the capital and the issuance of stocks. We have checked the results of the Board's reports on this. We have no observations to make on the operations that have been made. You can see it in the USRD -- in the URD. And we will come up with additional reports should the need arise. You can see in the following slides, all of these different capital operations that have taken place. I'm getting to -- that is it for the presentation. Thank you very much on behalf of the external auditors.

Thank you very much, Jennifer. And I'd just like to take advantage of this opportunity to thank Mazar because they have considerably helped the Audit Committee. They have -- we've been able to work seriously and constructively with them during their mandate. I would also like to welcome today Mr. Sébastien Arnaud, Xavier [ Creon, ] who belong to PricewaterhouseCoopers, and they are to be proposed as the new external auditors. So thank you very much for being present with us here today.

I think that we have finished with the presentations. We are running a little late. and we will move immediately on to the oral questions. I would like to inform you that some of these questions were actually sent by 2 of our shareholders, Mr. [indiscernible] that were sent in writing. So the answers given by the Board are available on the Internet website. I would now throw this meeting open to questions from the room. Are there any questions, please? I can see it firsthand.

Somebody whom I know well in this Board and somebody that the Board knows well.

Could you please tell us who you are each time?

Thank you very much, Jeff. You've given us a solvency ratio of 217% in 2025. Would that not be a good idea to actually increase the share investment to actually increase yields, profitability because for the investors who have had these shares for over 10 years or more, it is more profitable than bonds. But the downside is that it tends to immobilize capital. But the profitability that one could gain if you choose a good share portfolio is much higher if your portfolio is diversified.

Second question for Mr. Romanet. How much did it cost to come up with this sustainability report? And what are the advantages that can be felt by the company because other companies that are not within the European Union do not have to do these types of reports. And if we're not actually benefiting from doing these reports, it's a bit somewhat unfair competition.

Well, concerning the investment policy, what we have to understand is that we are not aiming here every time to take risks and look for the maximum profit. It is to manage these portfolios in a prudent manner. We have a lot of regulatory constraints, be it on currencies and the type of investment. And that's why we do have a high share of bonds.

Do you want to add anything?

No, no, I think that you summed it up very neatly. Now we are in Europe. You can't just take what is good and not accept what is difficult. And I think that Augusta would say the same. But as with many other companies, we criticized the CSRD with their 1,200 parameters. There are more than 3, 4, 5 or 6 KPIs. If you give more than that to somebody, an employee, then they simply won't work anymore. So I think that the European Commission is beginning to understand that bureaucracy does have its limits. And I think that, that is very good news for me personally, but also as CEO of SCOR.

[indiscernible] Campaign Manager for EMG Finance.

Now every year, I have to come and see you during your shareholders' meeting. I've been coming for 4 years. And I'd like to come back to SCOR's sustainability engagements. In 2025, you set up your first policies on fossil fuels, investments in coal. And over the last 10 years, you've made a lot of progress. But we are also seeing that there is something that you have ignored to talk about, and that is LNG. You've been talking about the impact of the fossil fuels of the LNG terminals that you are accepting to reinsure, particularly in the United States. 1 or 2 impacts. You are violating local regulations, ejecting toxic products, supplying in shale, which is a method that is -- that is forbidden in France and also reinsuring companies that produce methane amongst other things. And if you look at the destructive effects of LNG, you can see that there's going to be an increase of 50% of all of the emissions between now and 2050.

My question is the following. Your behavior and what the external auditors have said and the setting up of your ethics committee, what is all of that for SCOR is still accepting to reinsure some of the most polluting LNG terminals in the world. And you are going to be reinsuring new LNG terminals as well.

Thank you very much for this question, which is a very legitimate one. It's not the first time that we have evoked -- we approached this topic. The fact that since 2022 and onwards, there is more and more interest in LNG is clearly linked to Russia, the war between Russia and Ukraine. Now since 2023, there has been efforts to increase the deliveries of LNG to the world, which, to a certain extent, has been advantageous because otherwise it would be without energy.

Now with Augustin, we are doing the best we can to come up with a diversified energy sources. We exited coal. We are finding new companies to reinsure in oil. But for LNG, it's true that we're in a gray zone, and we're not entirely satisfied by that. But it does show just how difficult it is to find the fine balance between reinsuring LNG or polluting sites on one hand and the fact that all of this enhances pollution. we have what is called a sustainability referral committee as well in which we talk about these issues.

We are aware of what you are bringing up concerning some of the investments, and we do try to take them into account in our underwriting policies, which is -- but it's not systematic one way or the other. And if you have any more detailed questions, we will send you more detailed replies in writing.

I'm a private investor. Norges Bank had 5% shareholding. But at the end of 2025, they are no longer in your list, but you haven't commented on that. Can you tell us exactly why they left SCOR?

And secondly, 86% of the capital has not been officially identified. Can you give us an idea of how many shareholders you have, what the breakdown is between French and foreign shareholders?

Well, you've caught me on the back foot concerning the fact that Norges Bank has pulled out of its participation. As you've seen, we have a great majority of long-term shareholders, and I'm pretty certain that in 2024, given the performance in life and the very big cleanup that we had to do in life, the shareholders who remain during those times did manage to come out on top afterwards. Most of shareholders are faithful to SCO and to the SCOR share, but everybody is fully free to decide if they decide to leave. And that's probably why you saw that this the threshold of 5% has actually been dropped.

We don't have any other information, and we don't actually ever make any communications concerning shareholders who hold less than 5%. And as Fabrice Bregier has just pointed out, the certain choices are regularly made by shareholders. They increase. They cross the thresholds, they drop under the thresholds. Very recently, BlackRock fell below the threshold before, again, buying more. A comment without a microphone.

Any comments questions without a microphone cannot be interpreted.

Yes. But if they surpass the threshold and they're not mentioned, I was just wondering whether it was an error, that's all.

No. Don't try to read between the lines. It's not an error.

No, no, I wasn't. I was -- I just wanted some information. The question is, is it only those who have more than 5% of shareholding that are actually mentioned in this list?

It's just something that I picked up. We'll check on that.

And what about the breakdown of the 96% of the remaining shareholders. Who are they? Are they French? Are they foreign? Are they Chinese?

Well, I think what counts here is that we have the largest proportion as possible of long-term shareholders. It's not always easy to keep your shareholders, particularly when the share price fluctuates quite wildly.

And secondly, we are an independent worldwide reinsurer. And therefore, we have a great diversity in our shareholders. So I'm not at all shocked that there's 86% of shareholders that is above the threshold of 5%.

Now, I was just wondering how many? Can you just give me an idea? Is it 1/3, 2/3? You do roadshows. Do you get any feedback? I think that we must be in the average similar to other big French groups. You know that most of the capital is international in any case, if you're looking at the CAC 40 companies. I just wondered, did SCOR have -- was SCOR different at all?

Well, maybe we -- we do have French companies who are shareholders, but at a relatively modest level.

Another thing that I wanted to bring up concerning the members of the Board and the number of shares that they hold. I don't want to come back again about whether there is any conflict of interest amongst all of these stakeholders. Do you have an idea as to how they can solve all of these conflicts of interest? Or is it entirely left up to their own discretion?

You're talking about giving shares of 100,000 to 400,000. I just wanted to get back to your first point. For Norges Bank, we have not received any declaration as to the fact that they have fallen under the 5% stakeholding. In the URD, we indicate all of the notifications that we have had either to us as an issuer or to the MLF.

And on your second question, I don't have anything specific that I want to reply to that. Again, no microphone. no interpretation.

Any other questions? I don't see any other questions that are being raised. So let's move on now to the votes. Thank you for reminding me of my duties.

So I need to return to the script of my intervention. But since I'm going to hand over briefly to Claire, it shouldn't take long. I now have the final number of shares present or represented slightly higher than the number, 126,928,003 shares for 2,039 shareholders, and that's 70.99% of voting rights. We will now begin the vote on the resolutions. to be found in the notice of meeting and the convening notice or was that published in the mandatory legal notices bulletin in March last year, and we are now going to vote on the resolutions of this combined shareholders' meeting.

Thank you. After a reminder of the purpose, the resolution will be put to the vote using the electronic devices that you received on arrival. Just a short video to remind you how the voting devices work.

[Interpreted]

So let's now move to the vote on the resolution, starting with the ordinary resolution. First resolution, approval of the financial statements for the year ended December 31, 2025. The vote is open.

[Voting]

No more voting. Approval 99.99, approval of consolidated statements for year-end December 31.

No more voting. Approval 999, approval of income determinidend for year ended December 31, '25. Please vote now.

[Voting]

Vote closed. Approval 99.99. Auditor special report and agreements referred to Article 235, 38 of the French Commercial Code. Please vote.

[Voting]

Vote over. 99.89, approval information related to compensation of corporate officers referred to in Article 221091 French Commercial Code.

[Voting]

Vote closed. 91.15, sixth, approval of the fixed variable exceptional components of the total compensation of benefits of any kind paid or awarded to Fabrice Bregier, Chairman of the Board for the year ended December 31. Please vote.

[Voting]

Approved 8867 approval, fixed variable exceptional components of total compensation and benefits in kind paid or awarded to Thierry Leger, Chief Executive Officer for the year ended December 31, 2025. Please vote now.

[Voting]

No more voting. Approved 92.64%. Eighth, approval of 2026 compensation policy for directors and observers for 2026. Please vote.

[Voting]

No more voting. Approval 95.32%. Ninth approval of 2026 compensation for Chairman of the Board for 2026. Please vote now.

[Voting]

Vote closed. Approval 91.61%. Tenth approval of 2026 compensation policy for CEO for 2026. Please vote.

[Voting]

Vote closed. Approval 93.35%. 11th,renewal of the term office Mr. Director of the company. Please vote.

[Voting]

Vote closed. Approval 99.18. 12 renewal of the term office Mr. Thierry Leger, Director of the company. Please vote.

[Voting]

Vote closed. Approval 99.52. 13, Vanessa as Director of the company. please vote.

[Voting]

Vote closed. Approval 88.72%. 14 renewal of the term of office of August Director of the company. Please vote.

[Voting]

Vote closed. Approval, 95.1%. 15, appointment of Jacques as a Director of the company. Please vote.

[Voting]

Vote closed. Approval, 72.28%. 16 appoint of Jean-Fracois as Director of the company. Vote open.

[Voting]

Vote closed. Approval 99.96%. Renewal of KPMG as Statutory auditors vote open.

[Voting]

Vote closed. Approval 98.87%. 18 renewal of KPMG statutory auditors in charge of sustainability information. Please vote now.

[Voting]

Vote closed. Approval for 99.89%. 19, appointment of PwC audit statutory auditors. Vote.

[Voting]

Vote closed. Approval 99.98%. 20, authorization granted to the Board to carry out transactions in the company's ordinary shares. Vote open.

[Voting]

Vote closed. Approved, 97.32%. We now move to the extraordinary resolutions requiring a 2/3 majority 21, delegation of authority to the Board to decide on capital increases by capitalization of profits, reserves or premium. Please vote.

[Voting]

Vote closed. Approval 99.98%. 22, delegation of authority to the Board to decide to issue shares and/or securities giving immediate or future access to ordinary shares to be issued with preferential subscription rights. Please vote.

[Voting]

No more voting. Approval 94.33%, 23, delegation of authority granted to the Board to decide to issue as part of a public offering other than those referred to in Para 1 of Article 412 of the Monetary Financial Code, ordinary share securities giving access to ordinary shares without preferential subscription rights with a compulsory priority subscription period. Please vote.

[Voting]

Vote closed. Approval 91.25%. 24 delegation of authority granted to the Board to decide to issue as part of a public offering referred to in Para 1 of Article 411.2 of the code, ordinary securities giving immediate access to ordinary shares to be issued without preferential subscription rights. Vote open.

[Voting]

Vote closed. Approved vote 88.99%. 25, delegation to the Board to decide to issue shares and/or securities giving immediate or future access to ordinary shares to be issued to one or more person specifically designated by the Board without preferential subscription rights. Please vote.

[Voting]

Vote closed. Approval, 89.46%. 26, delegation of authority to the Board to decide to issue shares and/or securities giving immediate or future access to ordinary shares to be issued as consideration for securities tendered to a public offer initiated by the company without preferential subscription rights. Please vote now.

[Voting]

Vote closed. Approved, 95.7%. 27 delegation to the Board to decide to issue shares and/or securities giving immediate or future access to ordinary shares to be issued as consideration for securities tendered to the company without preferential subscription rights. Please vote.

[Voting]

Vote closed. Approved 91.28%. 28, authorization to the Board to increase number of shares to be issued in the case of a capital increase with or without preferential subscription rights. Vote is open.

[Voting]

Vote closed. Approval 86.10%. 29, to the Board to issue warrants exercisable for ordinary shares of the company without preferential subscription right for shareholders in favor of categories meeting criteria with a view to implement ancillary own funds program. Vote open.

[Voting]

Vote closed. Approval 92.42%. 30, authorization to the Board to reduce the share capital by canceling treasury shares. Please vote.

[Voting]

Vote closed. Approved 99.99%. 31, authorization granted to the Board to reduce the share capital by purchase option to employees and executive corporate officers, companies of affiliate companies with waiver of the preferential subscription rights. Please vote.

[Voting]

Vote closed. Approved 96.7%. 32, authorization to the Board to award existing ordinary shares, ordinary share to be issued of the company to employees and executive corporate officers of the company and affiliated companies or groups. Please vote.

[Voting]

Vote closed. Approved 93.23%. 33, delegation to the Board to carry out a capital increase by issuing ordinary shares reserved for members of the company's employee savings plan without preferential subscription rights in favor of such members. Please vote.

[Voting]

Vote closed. Approval, 98.96%. 34 total maximum amount for capital increases. Please vote.

[Voting]

Vote closed. Approved 95.12% 35 ratification of amendments to Article 19 of the company's articles relating to exercise of voting rights together with drafting additional amendments. Please vote.

[Voting]

Vote closed. approved 99.81%. Last resolution, powers for formalities. Please vote.

[Voting]

Vote closed. Approved, 99.79%.

Thank you very much, Claire. This brings us to the end of our shareholders' meeting. Thank you for your attendance and for your support. I declare the meeting adjourned.

Good afternoon, ladies and gentlemen, and welcome to the SCOR Q4 2025 Results Conference Call. Today's call is being recorded. There will be an opportunity to ask questions after the presentation. [Operator Instructions] At this time, I would now like to hand the call to Mr. Thomas Fossard. Please go ahead, sir.

Good afternoon, everyone, and welcome to SCOR Q4 2025 results on SCOR . I'm joined on the call today by Thierry Leger, Group CEO; and Francois de Varenne, Deputy CEO and Group CFO, as well as other Comex members. As usual, can I please ask you to consider the disclaimer on Page 2 of the presentation. And now I would like to hand over to Thierry.

Thank you, Thomas, and hello, everyone, also from my end. I hope you're doing well, and I thank you for joining SCOR's Q4 earnings call today. SCOR delivered another strong quarter, finishing 2025 on a high note. The group achieved a full year net income of EUR 846 million, the highest level in SCOR's history. The return on equity reached 19.1%, both clearly exceeding group targets.

All 3 businesses contributed to these excellent results, P&C, Life & Health and Investments, each one delivering quarter after quarter. Our employees executed in a disciplined way on the Forward '26 strategic plan. We fully leveraged SCOR's Tier 1 franchise, seeking for every profitable business opportunity. We have continued to grow in a strategic and diversified way.

The strong results are also supported by operational excellence and the rigorous cost discipline we established in Forward '26. Accordingly, we achieved EUR 170 million of savings already after 2 years, 1 year ahead of target, allowing us to keep management expenses flat compared to 2023. Let me turn to the 2025 dividend. At year-end, our solvency ratio was 215%, an increase of 5 points compared to 2024 and at the higher end of our target range.

The economic value grew by 13.7% at constant economics. The outlook is positive for our 3 businesses, thanks to satisfactory 1/1 renewals and our diversified business model. On the basis of these strong results and confident business outlook, the group's Executive Committee has decided to propose a dividend of EUR 1.9 per share to the Board of Directors for the financial year 2025, up 5.6% from EUR 1.8 per share the previous year.

You may recall that SCOR introduced a new capital management framework in 2023, which includes a dividend ratchet policy. Accordingly, the proposed EUR 1.9 dividend per share will set the new floor offering an attractive yield. This demonstrates our ability to create sustainable value and to offer a resilient and predictable dividend to our shareholders.

As we are entering the final year of Forward 2026, I would like to take a moment to speak about the significant progress we have made in building a future-ready platform. We have evolved on all 4 pillars, and I'm confident that we will reach 100% completion rate by the end of '26. We are already dynamically allocating capital to diversifying and profitable lines of business today, improving value creation and capital generation. In 2026, we will enhance our monitoring and decision-making platform further.

We have expanded in risk partnerships, supporting growth, helping manage the group's risks exposures and generating additional fees. Future developments in this space will mainly depend on the P&C cycle and the attractiveness of new business. Our ALM has evolved from static to standardized from fixed asset durations in the past to improved cash flow matching between assets and liabilities today.

Improvements in 2026 will introduce a specific ALM data platform, allowing us to move to a dynamic ALM. And finally, in tech and data, we are on a good path to complete our 6 AI flagship projects. Already in 2026, we have begun applying AI to our core processes and our underwriting. This will be a major strategic area for us in the next strategic plan. And finally, as part of operational excellence, we are enhancing processes, data quality and systems across the value chain.

We expect significant simplifications and efficiency quality gains from this program. Let's turn to the renewals. In a more competitive environment, SCOR applied a disciplined underwriting approach to the January renewals. Our teams leveraged SCOR's Tier 1 franchise to seek every profitable and diversifying opportunity to be added to our portfolio. As a result, we have been able to grow our business at still attractive prices and terms overall.

Growth has been achieved in our target markets and with some core clients where we profited from a flight to quality. We have faced headwinds in some specialty lines, but we remain confident in our ability to grow profitably in these lines of business in the mid and long term. To conclude, for 2026, I'm confident that we will continue to deliver a P&C combined ratio below 87% as per our 3-year strategic plan Forward '26. In addition, we should be able to continue to build buffers opportunistically.

Before handing over to Francois, a few words on what is happening in the Middle East. First of all, our thoughts are with the populations in the impacted countries. We hope that the conflict can be resolved soon. For SCOR, the immediate impact in terms of claims is negligible at this point in time. War is, in general, excluded from our contracts and where war is covered, our exposures are clearly limited, monitored and priced for.

Francois, over to you.

Thank you. Thank you very much, Thierry. Hello, everyone. I will now walk you through our Q4 results. I'm pleased to report that 2025 was an excellent year, supported by a strong performance under both IFRS and Solvency II and delivery 1 year ahead of our cash flow targets. In Q4, SCOR reported a net income of EUR 214 million, implying an annualized return on equity of 21.1%, supported by contribution of our 3 business activities.

Now I will go on with more details regarding our Q4 results. Let's look first at P&C. In Q4, P&C new business CSM is positive, though modest versus the full year level, reflecting seasonality. First, Q4 new business CSM is impacted by the low number of renewal and then by the early recognition of retrocession contract, a large part of our proportional retrocession cover renewed at 1/1/2026. This shows a pattern consistent with last year.

Maybe more relevant is to have a look at the full year 2025 new business growing by 9%, benefiting from growth in our preferred lines, dynamic retrocession buying with some offset by a more competitive P&C pricing environment and some margin pressure in certain inward segments. The P&C insurance revenue is down by minus 1.6% for the quarter at constant FX, mainly driven by a single-digit decline recorded by SBS.

On a full year basis and adjusted for large commutation, the full year 2025 insurance revenue growth is flat, consistent with prior guidance provided in previous calls with reinsurance up 2% and SBS down by 4%. Moving on to the underlying performance of our P&C book. P&C performance is excellent again in Q4 as in Q1 and Q2 with a reported combined ratio well ahead of our Forward 2026 assumption of below 87%.

Nat Cat ratio stands at 7.6% in Q4 and 6.8% year-to-date, well within the annual budget of 10%. The attritional loss ratio amounts to 74.7% in Q4 and as a reminder, also includes the additional buffer that we put aside during this last quarter of the year. Year-to-date, the attritional loss ratio stands at 76.4%, showing a slight improvement from 2024 at 77%, a very strong achievement given the additional prudence built during the year.

As Thierry mentioned it, overall, this supports our confidence in delivering on our Forward 2026 assumption with a P&C combined ratio below 87%. The completion of the annual P&C year-end review confirms all lines are at best estimates and our reserve resilience has even increased. Now let's have a look at Life & Health. Life & Health generated a new business CSM of EUR 170 million in Q4. This is mainly driven by protection and longevity.

This is higher than in the previous quarter of the year, but related to quarterly volatility. The full year Life & Health new business CSM stands at EUR 464 million, well above our EUR 0.4 billion new business CSM annual assumption. Life & Health delivered an insurance service result of EUR 115 million in Q4 and EUR 450 million for the full year, comfortably ahead of our guidance of around EUR 0.4 billion per annum.

This performance highlights the resilience of the underlying business. On experience variance, we mentioned it in the past, it typically takes at least 2 years before trends can be properly assessed. With 4 quarters of data under IFRS, it remains premature to claim for any victory after the 2024 actuarial review, but the observed positive experience variance is very encouraging. The loss component that you see this quarter relates to a limited number of existing underperforming contracts.

After a slight deterioration observed over the first 9 months of 2025, we have taken on this stock of contract prudent action, including strengthening reserves when appropriate. We remain comfortable with reserve levels at best estimate today. As such, this development is fully understood and not a concern for us. The Life & Health CSM is slightly down on a reporting basis at EUR 4.9 billion, but up 6% at constant FX.

Before moving to investments, let's have a look to our group reserve resilience. Throughout 2025, we increased P&C reserve prudence as part of our opportunistic buffer strategy, reaching a level above what we initially targeted by the end of 2026 when we presented Forward 2026 in September 2023. This was enabled, of course, by strong underlying P&C performance. Combined with Life & Health, this increased IFRS this increased group IFRS resilience translates into an increase in the group risk adjustment confidence level to 75.5% to 82.5%.

As the chart shows, this is another area where SCOR has made significant progress since 2023. Going forward, in 2026, we intend to maintain our opportunistic buffer strategy, mostly on P&C. On investments, performance remains strong. Return on invested assets is at 3.6% in the quarter, generating income of EUR 209 million. This reflects a regular income yield of 3.8%, supported by dividend received from our private equity and infrastructure fund bucket.

The credit portfolio remains very high quality and expected credit losses are broadly unchanged during the quarter. Turning to economic value. Economic value increased 13.7% at constant economics over the full year, reflecting the strong business performance across P&C and Life & Health and above the Forward 2026 target of 9% per annum over the plan. Economic value per share stands at EUR 48, broadly stable versus last year.

Financial leverage increased to 25.3% from 24.5% at the end of 2025, following the successful issuance of a new Tier 2 debt tranche in September. As a reminder, we are proactively anticipating the refinancing of corporate debt, and we aim to provide credit investors with larger and more liquid tranches. Looking ahead to 2026, I would highlight the potential repayment of EUR 283 million related to the remaining EUR 600 million Tier 2 note, which has its first call date on the 8th of June 2026.

Finally, on solvency. The group solvency ratio stands at 215%, up 5 percentage points versus 2024 and Q3 2025, reflecting satisfactory net operating capital generation during 2025. At the same time, during the year, we made further progress in terms of ALM, as mentioned by Thierry, which resulted in an improvement in the solvency ratio sensitivity.

I'm personally proud of what we have accomplished over the past 2 years on this topic that is dear to me. Overall, based on the quality of our results over the full year, we remain confident about achieving our Forward 2026 objectives in the final year of execution of this plan.

With this, I will hand over to Thomas, and we will start the Q&A session.

Thank you very much, Francois. On Page 23, you will find the forthcoming scheduled events. With that, we can now move to the Q&A session. Can I remind you to please limit yourself to 2 questions each. Operator, we can take the first question.

[Operator Instructions] We do have our first question from the line of Michael Huttner with Berenberg.

It's lovely results. So growth and the legal case. So growth, can you say a little bit more because when I speak to Thomas, he always says Thierry thinks that SCOR is underrepresented in the market in terms of share of wallet or whatever. So any feel for how you picture the potential growth of the franchise would be hugely helpful because it's nice to have margins, but growth is nice, too.

And then on the legal case, I think the -- there's one with the -- I can't remember the name, the arbitration. And I just wondered what the status is, whether we could expect anything and anything -- I know you can't talk too much, but maybe you've got something new.

Michael, thank you. I will take your first question. Francois will take your second one. You're absolutely right. I think that the Tier 1 franchise of SCOR, together with the relatively smaller market share we have globally provides SCOR with an opportunity. And so the way we are looking at it is twofold.

First of all, it allows us more than other companies to find opportunities that fit our targets business and target business for us must be the business that is profitable and diversifying. So that's critical for us. So we have more opportunity to grow into this or find opportunities in this segment. And as we have our teams out there every day, always using -- leveraging this franchise, we think, therefore, it should not just be margins.

It should also come with some growth. Now clearly, the market is turning softer. And I just want to be clear with everyone, whilst I think we do have that competitive advantage and whilst I'm determined to leave no opportunity, no stone unturned, we will give quality or underwriting priority, and therefore, growth will be an outcome and not a target.

I do believe, however, in the current environment, as we have demonstrated in January, we've been able to grow. And it shows exactly the point I'm trying to make that we should have a bit more chances than others.

On your second question, Michael, I'm a little bit like you. I don't remember the name of the case. But I would say that the arbitration process now is closed. So we are waiting now the decision of the panel, which is expected to be due now, I would say, mid-2026 or by the summer.

I just remind you on this topic that our provision on all major litigation and arbitration are our best estimate at the end of the year, both in our IFRS accounts and in the solvency ratio.

Thank you, Michael. Can we take the next question, please?

The next question comes from the line of Andrew Baker with Goldman Sachs.

First one on Solvency II. I guess if I look at the underlying capital generation, less the operating capital deployment and the proposed dividend, it was sort of 8 points positive for 2025, which was quite a bit ahead of what you were guiding for. So I guess as we think about 2026, specifically, how would you expect the underlying OCG and the operating capital deployment to play out? And then can you just remind me how we should be thinking about this between quarters, so seasonality between quarters, if possible? And then secondly, can you just help me understand, I think at the January renewals call, you talked about a stable nat cat budget guidance of about 10 percentage points for the year. If I look at your -- you grew premium in cat in a softening market. So presumably, your exposure growth was significantly higher than even the sort of double-digit premium growth you were showing. So how are you able to maintain that flat cat budget in percentage terms?

Thank you, Andrew. I will take the first question, and Jean-Paul will take the second one. So on your first question on net operating capital generation, of course, we are pleased with the profitability of our business. It reflects, as we mentioned already by Thierry and I a few minutes ago, it reflects both the strong underlying performance of our P&C portfolio and further supported by, I would say, better-than-expected Nat Cat claims during the year and also a solid contribution from the invested assets portfolio.

The good news this quarter and for 2025 is coming from capital deployment, as you saw it on the slide. As I explained during many road shows, the operating capital deployment has 2 components. One is the capital needs on the in-force portfolio, and then there is also the capital deployment on new business. So it's a complex mixture of the 2 effects.

Capital needs usually on our in-force portfolio depends mainly on, I would say, reserve development and how the business that we have written last year come on the balance sheet. And capital deployment, that's the other leg on new business depends, of course, on volume, but also on capital intensity and diversification per line of business. What we see in 2025 is the effect of our diversified growth strategy in both business units, by the way, leading to a lower capital deployment than last year.

On the Life side, what we see mostly in 2025, that's the effect of the announcement of the new strategy that we updated in December 2024, with higher profitability on protection and diversifying in longevity. And on the P&C side, that's the other leg of the component, I would say, of the capital deployment that we see mostly this year. So on the P&C side, we see a bit of reduction in our capital -- on our reserve capital and overall also a better diversification.

So now I mean, to answer more precisely to your question, what should we expect for 2026. We will revise today a little bit upward our expectation. But let's be precise on what we mean by net capital generation. So for 2026, our expectation is that what I call the double net, the net-net operating capital generation, so which means net of capital deployment and net of the dividend accrual, which mentioned by Thierry now as Rachet at EUR 1.9. So this net-net operating capital generation is expected to be in a range of 3 to 5 points of solvency ratio.

And Andrew, this is Jean-Paul. I'll answer your second question on the Cat ratio. So you're correct that on a gross basis, we increased our exposures at 1/1. And the way we manage our Cat ratio is through the optimization on the ratio side. So our Cat ratio is on a net basis, we have a plan going into the renewals and able to deliver on this plan.

We buy our retrocession in accordance, and that is why we're still confident of staying within the cat ratio budget of 10%. And as I mentioned during the renewals, if you look at individual perils, for example, in the U.S., we expect the females to go up compared to last year. On a number of perils, we expect the PMLs to go down compared to last year. But overall, the cat ratio will stay within the 10% budget.

Thank you. Can we move to the next question, please?

The next question comes from the line of Shanti Kang with Bank of America.

So just on the P&C opportunistic buffer building that you said will carry on in 2026. Do you think you could give us a kind of quantum on how much more buffer building will take place? Do you think maybe year-on-year, that will be higher or lower?

And then perhaps linking into that, the direction of that risk adjustment percentile, the increased upper end to 82.5% is a good step. How are you thinking about the direction of that going forward? Should we expect that to increase further, for example?

Thank you, Shanti, for your 2 questions. So on the P&C buffer, so we mentioned, you remember last year during the annual call that we were significantly above the initial target of EUR 300 million. We mentioned in Q3 a quarter ago that we already put aside more in 2025 than in 2024. So you can imagine that we are above the double of the initial target today.

So which means that we are really confident, that's what I mentioned in my speech at the beginning. We are really confident in the fact that we can really still continue subject, of course, to potential claims in the future, but we can really still put aside in 2026, a significant amount of buffer. It's on a full year basis, you can understand it's a few points of the combined ratio. So despite what we said during the 1/1 P&C renewal call with, I would say, an expected impact of 2 points on the loss ratio.

We can absorb the impact over the next 2 years of this slight erosion of the margin by slightly reducing the buffer, but still this should remain quite significant. So what can we imagine that's your second question, the impact on the percentile. So you know that we publish only the group percentile. We don't give the split between P&C and Life & Health. I would say it's difficult to predict. It will depend a little bit on the amount of buffer.

So it will depend on the cat ratio and the attritional loss ratio. And for me, it's difficult to make a bet really on what will happen. But if we can still put aside some buffer, it should increase a little bit. But again, take into account that at group level, so we could have also mix effect coming from the rest of the group.

Can we move to the next question, please?

The next question comes from the line of Will Hardcastle with UBS.

First of all, on the call option, can you give us an insight perhaps into what would make you use the option? I think you've got up until the summer should you remain trading above the strike? And how can you help us think about this both tactically and strategically? Second of all, just thinking about the onerous contract in Life & Health, you talked about contracts, sorry. What exactly did these relate to, which underperforming contracts? Is there a specific line or a specific region that these were impacting?

I will take your first question. So on the call option, as we said already in the past, -- the option is considered in the money when the price reaches or exceeds EUR 28. The call option will expire in June this year. So we still have a bit of time ahead to take a decision. So I just wanted you to be aware, right? But obviously, we are monitoring this. We are monitoring the group situation. Everything necessary will be taken into account, but we have more time for a decision.

On your second question, Will, so again, I reiterate what I say. So that's really linked to the fact that we observed in Q1, minus EUR 6 million of loss component, minus EUR 10 million in Q2, minus EUR 20 million in Q3. So we decided to take action on this portfolio, which is nonperforming. So the adjustment is really linked to the year-end review.

We -- day 1 loss on new business remain really immaterial, nonmaterial in Q4. So the EUR 42 million is driven, I would say, by a combination of both volume updates and assumption refinements. We continue, of course, to monitor this portfolio very, very closely, and we will adjust reserve when appropriate and if needed in the future. Today, we are at best estimate.

So we are confident on the fact that this book should be okay in the future. On geography, I would say, I will not surprise you. I would say a significant part of the adjustment has been made on our Israelian portfolio, which is in runoff over many years, and that significantly impacted the book during the 2024 review.

Can we take the next question, please?

The next question comes from the line of Kamran Hossain with JPMorgan.

Two questions from me. The first one is just on dividend trajectory from here. Clearly, a very welcome increase this year after a number of years of maybe keeping it flat. You pointed to kind of better capital generation than you targeted when you set out the initial guidance. Do you think it's possible for the dividend to step up a little bit further as you get into the end of '26?

And the second question is just on the Life book. It sounds like you're very pleased with the results you've seen in Life and fast forward kind of 15 months, things seem to be going pretty well there. At what stage do you think it will be possible to increase the EUR 400 million insurance service result in Life? So those would be my 2. And just a really quick word to say, Francois, thanks for your help over the years.

Kamran, I'll take your first question on the dividend. So I just want to remind everyone of a few things. So first of all, we -- as you pointed out, with a good satisfactory solvency ratio in the upper end of our range at 215% plus the growth in our economic value plus the positive outlook, actually, we felt we are in a good position to increase the dividend. If we look ahead, I guess we have to maybe remember ourselves that this has been the first increase after several years of stability in the dividend where we haven't been able to increase it.

That's why we think this is an important first step for us. And I really have to defer to the future on the one side regarding '26, but in particular, to the new strategic plan for better indications on where the dividend journey will go. Just so much, we have now for several months, started to talk a lot about capital generation and how important it is to us.

It's one of the core elements we are looking at as a team. And therefore, we are really satisfied with what we have seen so far, and we will put a lot of emphasis on capital generation in '26 and in the next strategic plan.

Thank you, Kamran, for your kind words. On the ISR, if I understand clearly, your question is what could be the guidance? We won't provide a guidance during this call on 2026. I would say if you look at the ISR outcome in 2022 on the Life book, it's the combination of different items. We have a stronger-than-expected amortization of the CSM. We have a positive -- I'm commenting on the full year basis.

We have a positive expense variance. We have this impact -- negative impact on onerous contract, mainly coming from year-end review on nonperforming contracts, and we consider today the portfolio is at best estimate. So we prefer to repeat again that only 4 quarters following our Life finance review of 2024 will require at least 4 quarters in addition to what we see today to claim for the victory.

Having said this, of course, Thierry and I and Philippe as well, we are very satisfied by the performance of the book, which underscores the resilience and the robustness of underlying business. So we are very satisfied by Q4. It should give you an indication of what we have in mind.

Thank you, Kamran. Can we move to the next question, please?

The next question comes from the line of James Shuck with Citi.

I just had a couple of questions, please. Just on the capital generation again. I mean, obviously, it was much stronger in 2025, and you've given some helpful guidance for '26 as well. I mean that's looking like kind of 16 points or so -- 11 to 13 points of CapGen over the 2 years, '25 and '26, net of all of the things that you mentioned earlier. I guess the CMD, you were indicating 2 to 4 points. So my question is really kind of what has actually changed?

And it's great to see the numbers come through. But is it increased use of retro? Is it slower growth, less capital deployment? Just kind of keen to understand why there's such a big delta to what you're indicating at the CMD versus what we're looking at now.

And then secondly, just on the risk of focusing on a negative thing. But I was just interested to understand more about the high level of man-made losses in Q4. This is something that came through in Q3 as well. So I just want to understand if there's any trend there at all.

Yes. The point on capital generation, I mean, you see here the capital deployment really consists of the components that Francois has elaborated. So first, it's really our development of the in-force together with the new business of last year, how this comes on the balance sheet. And what we have seen, in particular, the situation on the Life side is quite stable.

So we didn't use a lot of additional capital for the in-force combined. And on the P&C side, we saw even a slight drop of the capital consumption of the in-force. And together with the new business that we bring on the -- in the solvency ratio in the SCR for this year, which is really showing the diversified business strategy that we have outlined, we saw now a reduction of the capital deployment to EUR 160 million. In this mix, you have a bit of diversification also driven by the longevity that we have written in Q4.

I think, James, that our efforts, right, to focus on capital generation, but also on capital deployment, we have always said diversifying lines to actually get a better mix, a better diversified mix of new business on the books that slowly also get on the books actually and create the reserves that we have. I think this is all going in the right direction. And we see now the numbers slowly emerge.

Do you mind if I just quickly follow up on that? Because I can understand how the numbers work to get you to what the numbers are. But my question is really kind of -- it's such a big difference from what you were indicating before. So how was it different to what you were expecting at that time is really my question.

Yes. So I think, I mean, the underlying explanation, I mean, you have it. I mean that's the dynamic on the release on the in-force or capital deployment on the in-force and capital deployment on new business. When we said that we revised a little bit the net-net OCG expectation or assumption for 2026 to 3.5. The EUR 160 million that you see on Slide 21, which is the additional capital deployment through the SCR, it's mostly a good guy of 4 points versus 2024 and we just take the mean or the average of 2 points to lift a little bit upward our expectation.

And James, I'll take your second question. So I think you may have misunderstood. The Q4 environment was heavy man-made losses, but actually man-made losses to score remain in normal. As you mentioned, Q3 was higher, but Q2 was lower. So you have this quarter volatility, which is normal. But if you look across the year, our man-made losses are, I'd say, within the normal expectation, and that's reflected in the quite good attritional loss ratio we produced for the year.

Got it. Okay. And best of luck for the future.

Thank you very much.

Can we take the next question, please?

The next question comes from the line of Vinit Malhotra with Mediobanca.

Congratulations, Francois as well on your next and all the best for next endeavors. From my side, I mean, there's one topic on the P&C and apologies if it's really 2 sub-questions there. But if you think that the renewals last year were about 7% or so growth, you see 4-point something this year. You see the very strong alternative solutions. I know the SBS is a bit weaker.

But -- and I know you said growth is an outcome, not a target. But would you say that the original 4% to 6% target, I think it was, would you say that you're going to be a little bit in the middle of that range? Or would you say where -- given the data we have and then what you probably expect, what would you still indicate to us? And just quickly, just following up again, the 74.7%, which is a very strong attritional level, is that -- do you think some exceptional things there happening?

Is it because E&Cs are still helping out? Or is that something that we can think of as likely the starting point? Is it some more commentary on that would be very useful.

Vinit. So regarding your first question, it's still relatively early in the year. And the final outcome of the P&C ISR growth will largely depend on the upcoming renewals also later in 2026. As Thierry mentioned, our focus remains firmly on improving the profitability and quality of the portfolio rather than pursuing volume growth.

And accordingly, insurance revenue growth this year will be driven by the availability of attractive and profitable opportunities in the market. So we're not going to provide any indication at this stage as I think it's a bit too early. As you said, the renewals at January 1 on the treaty side were quite positive. We're still earning through the portfolio of 2025 as well in the first and second quarter, especially.

And then SBS, the cycle on the insurance side is also quite difficult. So all these factors put together makes it a little bit too early to give you any indication. On your second question on attritional losses, I think, as I mentioned before, there's nothing -- there's no exceptional item in this. It's really the strength of the underlying portfolio that's coming through.

You have, as usual, every quarter, some volatility. But I would say the attritional that we're producing for the full year 2025 is pretty much in line with our expectation of the performance of the portfolio.

And Vinit, just to remind everyone, of course, this attritional loss ratio is including the buffers. And it's also clear that if the renewals are done at slightly worsening trends, right, this will impact, as Francois said before, the buffers first, right? So that means that we are relatively confident still in being able to get the performance around this attritional loss.

Can we move to the next question, please?

The next question comes from the line of Ivan Bokhmat with Barclays.

I've got 2 relatively small questions, please. The first one, thinking into 2026 and '27, there is a solvency reform ongoing. I was just wondering if you could give your expectations of what impact SCOR would see?

And the second question, quite technical. As we look at the cash generation from your Life business, it continued to be negative in the second half of 2025. So I was just wondering if you could maybe give some color, is it related to the business mix, like financial solutions growth? Or is there anything that could help us?

So we'll take -- Ivan, I will take your first question. So we don't change what we said on the impact of the EPA reform to be implemented in 2027. We're waiting, by the way, the final guidelines for the implementation of the reform. [ FCO ], we mentioned it, it's mostly an impact through the risk margin and the cost of capital.

So we maintain what we said. We will provide probably at the end of the year with publication of the strategic plan an update on this. But we maintain that we expect a good guide of 10 to 15 points of solvency ratio, including the fact that we're going to lose the benefit of the contingent capital facility we've got in the balance sheet. On the second question, Philippe?

Yes. On the Life & Health cash flow, I mean, I think better to look at this on a full year basis rather than quarterly. And we remain committed with our goal for forward 2026. And we see improvements underlying it, but still quite some volatility.

Thank you, Ivan. Can we move to the next question, please?

The next question comes from the line of Iain Pearce with BNP Paribas.

Just coming back to this capital generation point. I'm just trying to understand what you're assuming in the 3 to 5 percentage point guidance for next year, particularly around the operating capital deployment. Should we be using this level or the 2025 level of operating capital deployment as a relatively normal level of operating capital deployment?

I'm just trying to understand, just clarify that move from the '24 capital deployment to the '25 level. Is it effectively the difference being capital deployment on the in-force was quite high last year and was relatively small this year. And if you're not deploying capital on the in-force going forward, this level is a good level for the 2026 capital deployment.

Thank you, Iain. So again, I mean, you remember, I mean, we mentioned initially in the plan that we had an ambition of, again, net-net operating capital generation of 1 to 2 points during the plan. So net-net means operating capital generation coming from the 3 business lines, so P&C, Life Finance and Investments, net of capital deployment and net of the accrued dividend in the solvency ratio.

So this revised expectation or assumption for 2026 to 3 to 5 points is mostly due to the fact that, again, this is the good guy that we see in Q4 on the operating capital deployment. We think as explained -- I explained a few minutes ago and reiterated by F -- we believe, I mean, the observed impact in 2025 is 4 points of solvency ratio, and we take, I would say, half of the good guy in our assumption for 2026.

So it's a little bit a new regime that we start to see here as developed by Thierry. We have been working hard on diversifying the portfolio, growing on diversifying line of business in P&C, and we start to see the benefit of the updated Life strategy of December 2024, especially with longevity transaction. We mentioned in the past that we used to have a strong pipeline on longevity. Now we see the traction.

Any follow-up Iain? No, that's okay. Okay. Good.

Iain , is already taking...

Okay. Thanks for your question. Can we move to the next one, please.

The next question comes from the line of Benoit Valleaux with ODDO BHF.

And first of all, I would like to warmly thank Francois for your strong support to investors, analysts and the financial community in general. And I wish you all the best in your new life. I have 2 questions, maybe the first one related to your rating. You have a better expected solvency margin, strong capitalization, strong underlying profitability, notably in P&C.

So I know that rating is not in your hands. But my question is more to know that if your outlook turned positive, for example, this year and maybe with a potential rating upgrade next year, will it have or not for you a positive impact in a soft market in terms of underwriting or no impact really to be expected on that front. And my second question is regarding tax rate, which has been slightly higher maybe than expected in Q4, but still at a good level at 28% for full year '25.

Just like to know if you maintain your 30% assumption for '26 -- and I know it's maybe a bit too early, but you made this announcement regarding your business in Ireland beginning of this year. So do you have a view on what will be a potential level of tax rate in '27.

Benoit, I will take your first question. So regarding ratings. So it's, I guess, clear to everyone that we are not setting the rating. But we do note a few things still. So first of all, as you know, there is 1 out of 4 major rating companies who put us with a positive outlook, which we see as a positive sign for future developments. When we look at -- and we have been consistently communicating on this. When we look at just the capital side with the different rating agencies, we have always been in a very good spot.

So the issue we were facing or the challenges from the rating agencies was much more with regard to consistency of our results. Do we have the franchise? Can we actually turn this into profit and capital generation and so on. So that was the challenge we faced. -- takes a moment to regain that confidence. But again, 1 out of 5 has moved positive. and my personal expectation is that others will follow in the next 12, 18 months.

But again, I do not set the agenda for this. Impact on business, when it went down, we were quite clear that this did not have an impact on our business. However, going forward, I do actually expect this to have a positive impact because as we want to utilize our Tier 1 franchise better, gaining market share, clients will see a growing contribution from SCOR.

And in that regard, an upgrade would actually really help us to gain additional market share tomorrow again if profitability permits that. So this asymmetrical view, I hope I have been able to explain it to you. Again, when it went down, we didn't really lose business, but now on the way up, we will count on it to grow our market share.

Benoit, thank you very much for your words, and thank you for the, I would say, the rich discussions we had together over the last few years, not only when I was CFO, but before as well. So on the tax strategy, I just remind you a little bit what we initiated with Thierry in 2023. remember, we had a significant impairment of our stock of activated on the balance sheet in 2022.

So the first priority was to protect what is already activated on the balance sheet to protect them against new and additional impairment in 2023 and after. So that's -- we initiated the strategy. The idea is really to relocate profit from the rest of the world in France. It took 2.5 years to do this. It's done. So we had 2 waves in '24 and in '25 of full restructuring of the internal retrocession structure of the group to move from stop loss to quota share, so to create profit assets and cash as well in Paris.

You saw it probably in January, we published a press release. So we redomiciliated one of our 2 Irish platforms, retro -- internal retrocession platform from Dublin to Paris. Now this entity is French based in Paris and regulated by the ACPR, so which means that the profit of this entity is now consolidated in the French tax perimeter -- so which means that I think it's protected now. I mean what is activated is really protected against any potential impairment.

And I think now the next step is to convince our auditors to activate what is not activated, and that's roughly EUR 250 million. And I'm sure Philippe will convince our auditors to do it as quickly as possible. On your question on the 30%, so we had this, I would say, assumption of 30% during the plan to take into account that we could have some friction during the 3 years, I mean, with this strategy to redomiciate profit in France.

You know that we changed something I mentioned in previous call, but we changed a little bit the way we compute the effective tax rate in Q1, Q2 and Q3, which is a little bit more normative compared to the previous year to avoid the volatility in Q1 and Q2 and Q3 -- and we adjust a lot to actuals in Q4. So don't look at the -- the effective tax rate of Q4, but look at the effective tax rate over the full year, that's a good indication, 28%.

I think it's a good indication for the future. Of course, everything is linked as well to the profitability of the business. So we have, as you see it and as mentioned many times during this call, we have an excellent performance of the P&C book. So this performance everywhere in the world is, in a way, repatriated in the French tax perimeter today. So it depends as well, of course, on the future profitability of the book.

Can we move to the next question and last question.

The next question comes from the line of Ben Cohen with RBC.

I just had 2 smaller things, apologies. I just wanted to ask, is there more to come through on the expense line in terms of savings in the P&C division after you sort of ahead of targets? And the second question was just the run rate of claims discount benefit in the combined ratio. Is that a reasonable outlook for full year '26?

Thank you, Ben. I will take this last question of my career as CFO. So just to remind you, we manage expenses at group level. Thierry commented in his introduction, the delivery of a significant amount of savings since the beginning of the plan, so EUR 170 million. and you know that we are committed to maintain stable expenses. So that's the way we manage internal expenses.

On P&C, it's a one-off. What you see in Q4 is really a one-off that reduced the expenses ratio to 6%. Again, if you look at 2025, the expense ratio stands at 7.4%, which remains slightly below management long-term expectation, and I prefer today to maintain the guidance of 7% to 8%.

So usually, this would be the moment where Thomas would thank everyone. But given the exceptional circumstances today around Francois's departure by the end of this week, I thought I just want to add a few words before closing this call. So obviously, as I said it, as everyone knows, this is Francois's last quarterly closing, and I wanted to express my sincere gratitude for his significant contribution over the past 3 years as Group CFO.

Francois has been my CFO since my beginning. We have gone through difficult times, good times as well, fortunately. Francois has played a pivotal role from the beginning in setting the Forward '26 strategy, but also in establishing a professional and strategic finance function. So Francois may thanks for all of this. Now we all know in life, everything has an end. And therefore, I'm also very pleased to have in Philippe a successor, a talent who can ensure a seamless handover.

So Philippe, also to you, thanks for accepting such a challenging role, and I wish you all the best, and I look forward to working with you. I see that Francois is sitting like on needles. I still not close the call.

Thank you. There is a little bit of emotion. So thank you, Thierry, for the kind words, which I really appreciate. It has been a real pleasure to work with you over the last 3 years. SCOR is in good hands with you and your comments. Philippe? A lot of success in your role. I'm sure you will deliver. Just a few final words for me. When I accepted your offer, Thierry 3 years ago in June 2023, I had 4 priorities in mind.

First one was to strengthen the resilience of our balance sheet and reserves. The second priority for me was to identify your specific concern you as investor and analysts on SCOR, so that we could take decisive action to reduce progressively our implied cost of equity. My third priority was to communicate with you as transparently as possible. And my last priority was to restore your trust in SCOR. I want to tell to Thomas, it's the day to say thank you to everyone.

I want to tell Thomas how much I enjoyed working with him. Thomas, you do a fabulous job. It was a pleasure as well to work with you every day. Your consistently positive energy fascinates me, and it was really a source of pleasure even in our situation in 2024. Learning and continuing to learn is one of the major driving forces in my life.

Thanks to you, all analysts and all investors, thanks to your questions, thanks to your comments. I've learned a lot during the last 3 years. So thank you very much for the quality of our discussion, our relationship and for your trust.

Thank you very much, everyone. And I think that on this good note, we can close definitively this call today. Thank you, and speak to you soon.

This does conclude today's call. Thank you for your participation. Ladies and gentlemen, you may now disconnect.

Good afternoon, ladies and gentlemen, and welcome to the SCOR P&C January 2026 Renewables Conference Call. Today's call is being recorded. [Operator Instructions]. At this time, I would now like to hand the call to Mr. Thomas Fossard. Please go ahead, sir.

Good afternoon, and welcome to SCOR P&C Jan 2026 Renewals Conference Call. I'm joined on the call today by Jean-Paul Conoscente, Chief Executive Officer of SCOR P&C. Before we start, I would like to remind you that SCOR full year results for 2025 will be results -- will be released on the 4th of March. So when it comes to questions, we will be only able to refer to the renewals information that is provided in the press release and the slide.

Can I please ask you to consider the disclaimer on Page 2 of the presentation. And now I would like to hand over to Jean-Paul. Jean-Paul, over to you.

Thank you, Thomas, and good morning, good afternoon, everyone. I would like to present to you today the results of the SCOR January 1, 2026, treaty renewals. These renewals account for around 2/3 of our reinsurance portfolio and around half of our projected annual P&C expected gross premium income for 2026. Additional details can be found in the slides and press release published earlier today. In a market that was competitive, we combined our disciplined underwriting and our Tier 1 franchise to achieve EGPI growth of 4.7%, excluding alternative solutions, with an increase of 2 percentage points in the net underwriting ratio.

Using our close client relationships, we grew our alternative solutions portfolio by 80.5% with a wide geographical spread. The January 2026 renewals took place in the context of ample capacity for most lines of business and adequate reinsurance margins overall. Demand for reinsurance generally increased with insurers looking to purchase more limits or more volatility protection. However, in most segments, supply exceeded demand. Negotiations focused primarily on rates with terms and conditions broadly stable, including attachment points. Nonproportional lines of business saw the largest price adjustments, albeit starting from a historically high point. Rate movements on proportional placements vary by market and line of business in accordance with the past performance of those portfolios.

Several global insurers and European insurers also took advantage of the reinsurance market dynamics to reduce the number of reinsurers they are dealing with. On our side, we focused our selective growth and on underwriting discipline. Outside of alternative solutions, we grew mainly in P&C lines where SCOR sees attractive opportunities by focusing on key clients where a shift to a more concentrated reinsurance panel offered opportunities for SCOR. We were also successful in transforming a number of new alternative solutions opportunities, leading to a strong growth at 1/1. In this competitive environment, we achieved growth across segments where profitable opportunities arose and protected margins in segments where price adequacy was limited.

Our selective growth approach enabled us to maintain a resilient growth performance across our traditional lines and to outperform in our Alternative Solutions segment. The overall gross price change for SCOR's portfolio is minus 1.9% with minus 7.8% for nonproportional treaties and roughly flat for proportional ones. On SCOR's Cat XL portfolio, the rate change was minus 12%. In most segments, competition led to improved pricing proceedings, but terms and conditions remain broadly stable.

We did not see a significant number of new aggregate covers or a shift in lowering cat retentions. The retrocession market also experienced strong competition with most participants looking to grow their exposures after several years of favorable results. Taking advantage of this environment, we were able to optimize our retro placements with a broadly stable structure and slight adjustments on nonproportional retrocession covers. The combination of these actions enabled us to limit the increase of our expected net underwriting ratio to 2 percentage points.

With this outcome, we confirm for 2026 our below 87% net combined ratio for '26 assumption. As previously mentioned, we performed active portfolio steering resulting in the following: in P&C lines, we achieved solid growth with core clients and in markets in APAC and North America focused on property and property cat. I would like to highlight that despite the 12% -- 12.5% growth in cat EGPI, we expect our net exposures to most peak perils to be broadly flat versus 2025 outside of the U.S., where we remain underweight and want to grow our net exposures given the price adequacy of that business. As every year, we will provide more details on our net P&Ls after the Q2 2026 results. We achieved a strong 80.5% growth in alternative solutions, responding to our clients' growing demand for customized reinsurance solutions. This success was achieved across all geographies and focus on our core appetite for capital release transactions.

In specialty lines, our premium income is flat as we protected our margins, growing some lines and reducing in others in a competitive environment. Let's move now to the outlook for the rest of 2026. We believe risk and volatility erosion will remain high, leading continued growth of reinsurance demand for the upcoming renewals for both traditional and alternative solutions business. In the absence of any major market shifting event, reinsurance market dynamics seen at January 1 should carry through the rest of the year with competition on the historically profitable segments. We also believe there will be continued flight to quality and to reinsurers that provide broad support across the different lines of business placed by the cedents.

In conclusion, selective growth and underwriting discipline were the 2 guideposts of our successful delivery of the January 1, 2026 renewals. We continue the strong momentum of alternative solutions development. We seize opportunities for profitable growth in segments where price adequacy remains good, and we leverage our net portfolio profile to dampen the effect of the more competitive pricing environment. As we move into the next renewals, we're keeping our objectives unchanged. Continue to deliver on our Forward '26 ambitions with discipline, strengthen the resilience of our business through diversification and active portfolio steering, maintain high levels of client engagement through solutions, partnership and innovation. And with this, I guess we will now open to questions.

Thank you very much, Jean-Paul. So with that, we're going to start the Q&A session. Operator, can we take the first question, please?

[Operator Instructions]. The first question comes from Andrew Baker with Goldman Sachs.

The first one is just on retrocession. So I guess in last year's January renewals, you got a much bigger offsetting benefit from retrocession on the net underwriting ratio. I think some of that was pricing and some was the change in structure. But are you able to just give a little bit more detail on the differences in the retro impact between what we saw last year and this year? And then secondly, obviously, now that we have the renewal data, are you able to give us any sense on how you would expect the first quarter '26 new business CSM to develop versus the prior year?

Thank you, Andrew. On your first question, so the retrocession program in 2026 remains broadly unchanged from last year in terms of structure and types of covers purchased. As usual, we made targeted annual adjustments to reflect our evolving risk appetite and to optimize the conditions in the market. And last year, we had done more significant changes to the program in terms of attachment points and shift between proportional and nonproportional.

In 2026, we benefited meaningfully from lower pricing as the retro market was highly competitive, mirroring what we observed on the assumed side, particularly for catastrophe covers. We're also able to achieve higher ceding commissions on proportional retrocession, which also strengthened the overall economics.

Terms of conditions in 2026 remain broadly stable, in line with what we saw on the assumed book. That said, we were able to achieve some lower attachment points or slightly improved wordings on selected programs, but it was fairly limited. And we continue to see strong appetite from alternative capital providers for retrocession placements, which supports both capacity availability and competitive pricing. So hopefully, that answers your first question. On the second question, it's a little bit difficult to answer. We'll provide you more details when we present our Q1 results later this year. I would say typically, the new business CSM is reflected in the EGPI more or less. The big difference is on proportional covers you only -- you take out the commission. So on nonproportional EGPI growth and new business CSM are in line, but on proportional, you have to look at the risk premium. So I can't tell you more than that, but we'll provide you that information, of course, at the Q1 results.

The next question comes from Shanti Kang with Bank of America.

So I was just wondering if you could talk us through how pricing adequacy is differing per line. And if there's anything that really surprised you about the renewals this year that might lead into how you guys are thinking to deploy your capital in the next renewal set, for example? And then just on specialty, I saw that, that shrunk a little bit year-on-year and growth was flat. Could you just tell us a bit more about the drivers of that and where you may be pared back?

Thank you. On your first question, so we were not surprised by the market reaction. Actually, I think the outcome was very much in line with what we had expected. Price adequacy, we see as very high on cat, not just because of pricing, but also because of the structural changes that took place in 2023 and has been stable ever since. So we think cat as a line of business, despite the change in pricing seen at 1/1 still remains highly attractive.

In specialty, it varies. I mean the competition was quite intense. I think many reinsurers want to grow in specialty, which increased the competition. Some lines of business we still see as good price adequacy like credit and surety and IDI. We see marine engineering coming under more pressure, still price adequate, but under more pressure. And I think we had expected some more hardening on aviation and cyber, which really didn't take place. And there, we basically protected our margins for those lines of business.

So hopefully, that answers both of your questions.

The next question comes from Iain Pearce with Exane BNP Paribas.

The first one is just coming back to the cat exposure growth. And I'm just trying to understand the comment around the PML moves when we look at the premium growth and take into consideration the pricing move that you've discussed on the cat book. So when you say PML is broadly flat, is that -- I'm sort of reading this as you expect most of the PMLs to be flat, but it sounds like the U.S. one should be up quite a bit. Just trying to think about the growth that you've done in the cap. Is that the right way to understand it? Or do you expect all PMLs to be broadly flat? And the second one is just on the 1.9% risk-adjusted pricing move versus the 2 points of combined ratio or underwriting margin impact that you expect. Just trying to sort of walk between those 2 numbers, considering that you sound like you expect a fairly nice tailwind to the underwriting ratio from retrocession changes, retrocession pricing. So just trying to understand why you wouldn't see a smaller number there on the underwriting ratio versus the risk-adjusted pricing.

Thank you. So on your first question, we try to manage our cat exposures year-on-year to be broadly flat. The guidance we had given for '26 is to grow our cat exposures in line with our shareholder equity. So in the U.S., we started expressing last year that we're still very underweight and want to retain more of the risk because out of all the cat business, it's the one that we see as the most price adequate. So we did some of that last year, and we'll do that again in 2026.

For the other peak perils, when I say broadly flat means that there's some perils that will be up compared to last year and some perils will be down compared to last year. But overall, outside the U.S., broadly flat. As I said, we'll provide you more information on that in July this year. And how we achieve that is basically adjusting the retrocession program to achieve the net profile that we're looking for.

On your question on the pricing risk adjustment. So it's just a coincidence this year that they're very close. The price adjustment that we published year-on-year is a gross price adjustment, and it takes into account only pricing effects. So it doesn't take into account change of commissions or anything like that. And it's the same methodology that we use in prior years. So this allows you to compare year-on-year how we view our pricing change in '26 versus how it was in '25. Whereas for the guidance we provide you on the net combined ratio, there, we do a calculation of the impact on margin, which is really, I think, what you and what we are interested in.

Hopefully that answers your question.

The next question comes from Michael Huttner with Berenberg.

You talked about broadly stable attachment points. I just wondered how broad is broadly basically? Is it like, before they were, I don't know, EUR 100 million, and now we've gone down to EUR 80 million or EUR 60 million? I'm trying to gauge because it sounds like some clients, some good clients, I guess, got some attractive deals and others didn't. But it's not -- I'm a bit confused. And then the other point, which I think was the previous question, I'm not sure I got the answer right. So the price adjustment growth, 1.9%, the combined ratio impact 2%, but retro -- surely retros, one is gross, one is net. So retro sort of softened the 1.9% down to 2. I don't understand. It sounds like there was actually no improvement in retro or there's a moving part which I'm missing.

Okay. Thank you, Michael. On your first point, attachment points, so the reason why we say broadly is because, as you mentioned, there's a few clients that were able to buy covers at a lower attachment point, and they were able to do so either because their attachment point was higher than their peers or they felt that they just want to retain less. And in general, the market supported that. But I'd say it's a few limited cases. And if you look across the whole portfolio, it was very limited. But there are cases.

And that's why we don't say it's an absolute, but it was fairly limited in number. On your second question, the minus 1.9%, again, is pricing. Then when you have to look at the margin, you also have to remember that this 1.9% is very different between nonproportional and proportional. Typically, if you look in terms of margin, the proportional business is where you have in relative terms, lower margins and the nonproportional in relative terms, higher margins as a percentage of premium. So as the price decreases were higher on nonproportional, then the margin fall was higher on the nonproportional. And so the retro help compensate all of some of this. But as I said, it's just a coincidence that this year, the price change and the deterioration in margin are very close.

It's more the dynamic of the portfolio between proportional and nonproportional.

The next question comes from Vinit Malhotra with Mediobanca.

Yes, I hope you can hear me.

So my 2 questions, please. The first one will be on the specialty lines, which -- I mean, one of your focus areas has been what you've called the diversifying lines, which we have talked about engineering, those kind of things. I mean you mentioned specialty lines seem to have more pressure. Could you just comment a bit about whether your strategy of that diversifying lines was still in play in these renewals? And second question is just to -- I don't know if it's too premature versus your results state, but at the 9 months, the commentary on combined ratio normalized was, say, 87.4% and then there was supposedly a 2 points of prudence and now we are taking a hit of 2 points. Is it a safe assumption or fair assumption that when you're still maintaining the better than 87%, you're basically saying the prudence may not be added this year, and that's the 2 points, which will keep the number where it is or better than where it is or at the target at least.

Okay. Thank you, Vinit. So on specialty lines, our target is still what we call diversifying lines, which was Marine, Engineering, IDI and International Casualty. We saw competition across all those lines of business. Probably the one where competition was the most intense was marine and engineering. So there, we always look at the price adequacy and now we're getting close to what we view as the -- what we call the hurdle rate. So the -- if you like, the loss ratio above which we don't make the margin that we're expecting.

So it was still the strategy. But as the competition got more intense, then the growth that we had projected for the lines of business was revised downwards. We see in the past, credit and surety, for example, agro were not really lines that were targeted for significant growth. Those lines are still quite price adequate. And so in those lines, we didn't necessarily target growth, but we maintained the portfolio there, and we grew single digit. And then as I mentioned before, cyber and aviation, we had hoped that the market would turn more than it did. And so there, we kept the portfolio flat. On your second question on the net combined ratio, if we look at the first 3 quarters, the 87% when you take out the prudence, we were still quite good, probably in the low 80s. And so we think with the renewal that we achieved at January 1, maintaining the below 87% is still very feasible, and we still think that we can add some prudence as well in 2026.

So you ended up, so you might still book some prudence. Is that what you're saying? Sorry?

Yes, we might. We might. Again, depending on the performance of the year, but the pricing of the business as we see it still should allow us to do so.

The next question comes from Darius Satkauskas with KBW.

So you had a lot of growth in your alternative solutions. And when it comes to your net underwriting ratio impact, it excludes alternative solutions. So I'm just wondering what kind of impact would you expect from that material growth? That's the first question. And the second question, can you just help us understand where is this growth coming from? And why now 81% is a large figure. Is it sort of your typical capital relief? Is there spread-based stuff there? What's going on?

Okay. Thank you, Darius. On your first question, so we're very pleased with the continued growth in AS. As a reminder, these structures are -- these are transactions that are highly structured. So they deliver a very high ROE because of the low capital intensity. And each transaction is fully bespoke with client-specific parameters and margin structure tailored for each client. Under IFRS 17, the AS book is underwritten with a typically lower net combined ratio than the traditional book because in IFRS 17, you only book the premium at risk and not the entire premium.

So the contribution of the AS book to the group combined ratio was positive, although still limited because once you take into account only the premium at risk, the overall volume is small compared to the overall P&C book. So I think when we present the Q4 results, we'll provide you some guidance there. But -- so it will be a positive contribution, but still limited overall. To your second question, why the growth now? I think this type of business is very lumpy. So sometimes you win, sometimes you lose. There's been a few players that have been well established in this marketplace. And so displacing them is not easy.

And I think what we've been able to do is basically gain market traction through our marketing efforts with our clients using our franchise. Second, I think we build our credibility in the space and clients are a lot more comfortable to see us let's say, as a peer to some of the more established players that have been there for a long time. And that's why we've been successful with this January 1. Are we going to continue on the same success rate for the rest of the year? It's very difficult to tell because as I said, the business is lumpy. And so I think for the rest of the year, we'll continue the same strategy. But I think we'll win some and we'll lose some. So I think January 1 was an exceptional outcome, but I wouldn't really be able to project that is going to be the case for the rest of the year.

The next question comes from Ben Cohen with RBC.

I just wanted to ask in terms of -- you made a reference to benefiting from a reduced number of counterparties in the market. So I guess that's about taking market share. Could you maybe give a bit more color there? And the second question was on your growth that you've had in North American property cat, where do you see your market share there now versus what you would see as your kind of natural market share on a global basis?

Thank you, Ben. On your first question, the reduced panels is something we saw mainly in Europe and a few large global insurers where those companies are trying to limit their core panel to something between 7 and say, 10, 11, 12 reinsurers with whom they place maybe 80% or maybe a higher percentage of all their programs.

Those clients view that as a benefit, still good competition because you have a large number of participants, but makes it easier for -- if there are specific losses, if there are discussions around wordings and things like that to have a limited number with a broad relationship overall. So this is something, I think when the market in 2023 was hardened, clients took as many reinsurers as they could because capacity was scarce. Now as we enter a market where capacity is in larger supply, they want to go back and sort of rationalize their panel a little bit. And in that movement, SCOR benefited because we have a wide breadth of covers we can offer across lines of business, across geographies and meaningful capacity.

So we gained from that movement at January 1. On your second question on North American property, we view our share right now as really small, undersized compared to, I'd say, our average market share on a worldwide basis. And so after this renewal, we're -- I think we're making headway, but we still have room to grow further without growing outside our exposures. So of course, we'll continue to be selective. It will be dependent on terms of conditions and price adequacy. But that being a given, we think we still have room for growth in the U.S.

The next question comes from James Shuck with Citi.

I just had a couple of questions, please. Firstly, so on the rate reduction of minus 1.9%, I believe that's net of CPI inflation rather than loss cost inflation. If you could just help me confirm that for me. And then kind of on loss cost trends, can you help me understand what your assumption is for loss cost inflation and whether there's been any changes to your modeling assumptions within that, please? And then secondly, just keen to understand, I want to try and link the capital deployment that kind of happened, let's say, in '25 with what you've seen early in '26. And indication you've given for the increase in the solvency ratio to grow kind of 2 to 4 points in '25 and '26. So is the capital you're deploying consistent with that 2 to 4 points across both years? Or do you think it's a bit higher or a bit lower?

Thank you, James. On your first question, so what we define as price change is similar to prior years. So it's the movement in price per unit exposure adjusted for structure change and share change. So it reflects the primary rate change for proportional covers. And then for nonproportional, it's the insurance rate change and the reinsurance rate change. So it does not reflect the change in commissions or our updated view of risk. So CPI is included in there, but our view of loss cost inflation is not included in that. On your second question regarding the Solvency II, I prefer to defer that question to the full year results in March. We'll give you an update and an outlook for 2026.

The next question is from Chris Hartwell with Autonomous.

Just a very quick question. Just wanted to sort of explore the growth in U.S. cat specifically. I mean you mentioned that you will give more detail on PMLs later in the year. But I wondered if you could just give a little bit of color on the type of sort of seed that you are growing this book with or sort of types of risk. I mean is this more of the sort of regional specialists? Or is this sort of the national programs? Just trying to get a better feel for the risk that you're actually opening yourselves up to on U.S. cat.

Yes. Thanks, Chris. The ones we had most successful with at January 1 were the national writers and sort of the larger regional ones. Those were the placements where there was opportunities for us to grow our shares. I think on the smaller clients, we see prices as probably tighter and competition also greater. So it was more difficult.

The next question is a follow-up from Michael Huttner with Berenberg.

One is mix and the other one is what are we missing kind of thing? So on the mix, I think speaking to you for IR team, the -- or maybe it was in the slide somewhere, I don't know. Nat cat is about 10% of your book. Your peers are closer to 20%. So this was 25%, obviously. Where do you think we'll end the year in '26, this 10% -- and then -- or where would you like to end the year? That's maybe the better question. And then the second, so you -- there have been several answers saying basically that you're getting more business because you're global, you've got a big reach, you've got -- you do lots of lines. So -- and I guess the cedents see you as high quality. Your PE in the market here doesn't say the same from the equity markets. Where do you think the disconnect is?

Okay. On the first question, so yes, you're right, nat cat represents roughly 10% of the overall book. I don't -- don't expect that to change significantly in 2026. '26 is the last year for '26 strategy. So there's no intention of making any dramatic changes for this. When we start looking at the new strategic plan for '27, '29, there we might revisit and have different ambitions. But for 2026, it might go up slightly, but it's not going to be very different.

On your second question, it's difficult for me to say. It's more a question I should ask you. Where is a disconnect. I think all we can do is keep delivering good results, trying to explain the actions we're taking. The clients see us as a reliable partner. a broad partner. And that's why on par with, let's say, the larger reinsurers. I think that's why they want to work with us. Why doesn't that translate into market price is more a question to you than to me.

The next question comes from Benoit Valleaux with ODDO BHF.

The first one, very quick, just to check based on what you've said regarding nat cat. So it's fair to assume that your nat cat budget for this year will be unchanged to 10 percentage points, just to confirm this. And the second question, in the end, this round of renewal has been a bit tougher than initially expected, let's say, in September, October. It's maybe a little bit too early, but what's your early view on April and June, July renewals? And maybe a third question, if I may, regarding cyber. Can you give some comment on pricing trends and profitability, sorry?

Yes. Thank you, Benoit. On nat cat, I confirm that our cat budget is unchanged for 2026 at 10%. Your second question regarding the early view of upcoming renewals. Again, I think what happened in January 1 was not a surprise. If you remember 2025, we saw some beginning of softening in January and probably more competition on pricing in April, June, July renewals. As a result, our expectation today would be the April, June, July renewals will continue to be competitive, but probably with price adjustments that won't be as strong as what we saw in January because it was an adjustment from the prior year and with all the capacity.

So that would be our expectation at this stage. Regarding cyber, I think there's -- the results have been mixed, to say the least in cyber. There haven't still been any very large losses. But I think the lack of, let's say, high returns in cyber would have give us hope of a tightening of the market, but we just don't see that. I think competition remains quite high, both on the primary side and the reinsurance side. And it's a line of business that many reinsurers want to grow to diversify their book, especially on the cat side. So from a market dynamics, it remains very competitive.

So the next question comes from Michael Huttner with another follow-up from Berenberg.

So this is really unstructured question, so apologies. But if I go to investors and I say, well, yes, SCOR is a great company, it's undervalued, it's everything. The question which comes back is, yes, but what is SCOR about? Is it just a kind of normal reinsurer like any number of reinsurers? Or does it have a particular focus, a particular area of expertise where they can say, I am, but SCOR is good at this and there's a little bit of a niche here or whatever. And it's a very broad question. You might say it's too complicated. But it's to try and bridge that gap between what clearly your clients see and what we see.

Thank you, Michael. It's not an easy question. I think how do we define ourselves? Really, we define ourselves as not a specialist in one line of business or in one geography, but as a global reinsurer being able to address, I'd say, most of the risk transfer issues that the client face. So that's really our proposition to be a global reinsurer with a broad offering of solutions. And what makes us different is we're smaller than the big ones. So we're probably more nimble, can react faster. We have a wide geographical spread. So we're very close to our clients, and this allows us to really have a good understanding of what their needs are and have the ability to react quite quickly to market dynamics or to new needs.

Yes. Just one follow-up. When Thierry arrived, I think he cut line sizes because you had lots of secondary exposures, which I think may have been outsized. Has this changed?

Yes, this has changed. This has changed before Thierry arrived when we did the remediation of the portfolio, I'd say, 2019 to '22. There was a rightsizing of the exposures across all lines of business.

And this hasn't -- you haven't loosened this?

No, no, no.

Okay. Thank you so much.

I think the results show that.

Can we take the next question please.

[Operator Instructions]. Gentlemen, we do not have any more questions.

So thank you, everyone, for attending this call today. As a reminder, we'll go now in a quiet period until March 4 for the publication of the full year results 2025. With this, I wish you a good day. Thank you. Bye-bye.

This does conclude today's call. Thank you for participation. Ladies and gentlemen, you may now disconnect.

Good afternoon, ladies and gentlemen, and welcome to SCOR Q3 2025 Results Conference Call. Today's call is being recorded. [Operator Instructions]

At this time, I would like to hand the call over to Mr. Thomas Fossard. Please go ahead, sir.

Good afternoon, and welcome to the SCOR Q3 2025 Results Conference Call. I'm joined today by Thierry Leger, Group CEO; and Francois de Varenne, Deputy CEO and Group CFO; as well by other Comex members.

Can I please ask you to consider the disclaimer on Page 2 of the presentation.

And now I would like to hand over to Thierry Leger. Thierry, over to you.

Thank you, Thomas, and welcome, everyone, also from my side. I'm satisfied with where SCOR stands today. We had another strong quarter, especially in P&C, where our strategy of diversifying growth pays off. The investment side continues to contribute in a stable and positive way to our results. And last but not least, on the Life & Health side, we deliver 1 quarter more in line with the updated forward 2026 plan.

Also, we are ready for the renewals to come and very focused on the delivery of our plan. Our teams are close to our clients, leveraging our Tier 1 franchise. We offer tailored solutions that create value for our clients and shareholders.

In the P&C context that has become gradually more competitive since 2024, a I would like to take a few minutes to reflect on the broader insurance landscape and the opportunities for SCOR as we approach the 2026 renewals.

Looking back, 2025 has been a good year for the P&C industry so far. And overall, 2026 is expected to remain a good vintage year by historical standards. Nevertheless, as profits are up and the supply of capacity now exceeds demand, even if demand continues to grow, it results in increased pressure on prices and underwriting discipline is being tested.

I have seen this before. This is the time when wrong strategic decisions can have a detrimental impact on the company's results. Usually, it is driven by the desire to grow in a particular line, some lines of business at the wrong time. Let me state this here very clearly such situations can be avoided. And at SCOR, we are determined to keep underwriting discipline high throughout the cycle.

Our business is one of diversification and volatility absorption. We are here for the long term and support our clients when they need us. We have to demonstrate strength and resilience when times are difficult. For SCOR, this means that we will stay focused on fundamentals and deploy capital where risk-adjusted returns are adequate.

We are maintaining our underwriting discipline, focusing on diversifying risk exposures and leveraging our analytical capabilities to support our teams to make the right decisions.

In addition, our Tier 1 franchise provides us with the opportunity to choose where we allocate our capital in a determined way.

I'm pleased to see that our teams are unaffected and fully focused on our clients and the business. They have no growth targets, but I have expressly asked them to leave no stone unturned to find profitable opportunities for SCOR and to discuss tailored solutions with our clients proactively. The aim is to balance long-term client relationships with bottom line, the latter being the priority ultimately.

For our investors, this means a continued focus on capital efficiency, risk-adjusted returns and long-term value creation through the cycles. We will keep expanding in diversifying lines, such as inherent defect insurance, engineering, credit maturity, structured solutions, international casualty, facultative business and longevity. We have a very selective approach to marine, aviation, cyber and U.S. casualty monitoring the dynamics closely.

In Nat Cat, where the cycle is most prevalent, we will monitor relative and absolute price levels, structures and conditions to determine where we deploy our capital. We will further consider our market share and exposure to climate change when we allocate our capacities.

We continue to be underweight in Nat Cat. As long as rate adequacy is sufficient, this gives us room to grow by respecting the risk limits we set for ourselves for Forward '26.

To conclude, climate change, geopolitical tension, cyber threats and AI create a more volatile and more uncertain environment, increasing risk awareness and demand for risk transfer. The need for a robust reinsurance industry is palpable, and growth opportunities are structural. Within this context, at SCOR, we remain confident in our strategy and optimistic about the opportunities ahead, even in a more competitive market.

Francois, over to you.

Thank you, Thierry. Hello, everyone. I will now walk you through our third quarter results. Starting with a few key messages. Thierry and I, we continue to be very satisfied with these results. The performance of our 3 business activities is strong, delivering EUR 211 million of net income, 21.5% return on equity and an economic value growth of 12.7% at constant economics. On a 9-month basis, the net income stands at EUR 631 million, translating into return on equity of 19.5%.

As mentioned by Thierry, P&C performance is excellent. The combined ratio for Q3 is at 80.9%, well ahead of our forward 2026 assumption of below 87%. These results reflect the very low Cat claims during the quarter and a slightly higher attritional loss ratio.

In this context, we have continued implementing our opportunistic buffer building strategy, albeit with an addition in Q3 of lower magnitude than in Q1 and Q2. The amount of prudence built over the first 9 months of 2025 is equal to the entire presence of 2024.

In Life and Health, with an insurance service result of EUR 98 million in Q3 and the year-to-date expand variance in line with our expectations, we are on track to reach our full year forward 2026 assumption of around EUR 400 million.

Investment had another good quarter. We achieved a 3.5% regular income yield, thanks to our high-quality fixed income portfolio that continues to benefit from elevated reinvestment rates. Our economic value increases by 12.7%, a translation of the good business performance, both in P&C and Life and Health. It is now very likely that our full year EV growth will stand above our Forward 2026 guidance of 9%.

Our group solvency ratio stands at 210%, stable to Q2, in the upper part of our optimal range. Q3 is a relatively low net operating capital generation quarter, given the absence of major P&C treaty renewals. Overall, thanks to the quality of our results over the first 9 months, we remain confident about achieving our full-year objective.

Now I will go on with more details regarding our Q3 results. Let's look at P&C first. In Q3, the P&C new business CSM is mostly stable year-on-year, excluding the FX effect. This is a strong achievement in an increasingly competitive environment. On a 9-month basis, our P&C new business CSM, grows by 4%, benefiting from our strategic growth in preferred line as well as our dynamic retrocession buying, which offsets the inward business margin erosion.

The P&C insurance revenue is down minus 1.6% for the quarter and up plus 3.1% at constant FX. In Q3, this is supported by growth in both reinsurance and as well at SCOR Business Solutions. In high insurance, the growth was driven by alternative solutions and our diversifying specialty lines. In SCOR Business Solutions, the trend has improved compared to the previous quarter as the timing effect on the renewal of some contracts has now caught up.

In addition, here as well, the growth was supported by alternative solutions and by our syndicate activities, partially offset by property.

On a year-to-date basis and adjusted for the large impact of the termination of one large contract and adjusted as well for FX, the P&C insurance revenue growth stands at plus 1%.

Moving to the underlying performance of the P&C book. Our P&C combined ratio stands at 80.9% in Q3, benefiting from low Nat Cat losses in the quarter. Nat Cat ratio stands at 2.7% in Q3 and 6.4% year-to-date, which means well below the annual budget of 10%.

Let's now focus a little bit on the attritional loss ratio, which is slightly more elevated this quarter than the previous quarter of the year. In Q3, specifically, we incurred an accumulation of small and midsized man-made claims. After investigating and checking the nature of those claims, I can tell you today that we do not expect at this stage of the annual P&C reserve review, any overall attritional deterioration of the P&C book by the end of the year.

This outlook is supported by the fact that we tend to take the bad news upfront, especially this quarter, not financed by IBNR, and we released the good news later.

On a year-to-date basis, the attritional loss and commission ratio stands at a robust 77.1%, which includes the presence build throughout the year. We are very satisfied with the shape of our P&C portfolio, delivering excellent performance quarter after quarter.

Now let's have a look at Life Finance. The Life Finance business generated a new business CSM of EUR 82 million in Q3 this is mainly driven by the protection business and by financial solutions. This is lower than in the previous quarter of the year, but related to quarterly normal volatility.

On a 9-month basis, with a new business CSM of EUR 284 million, we are well on track towards achieving the EUR 0.4 billion new business CSM annual assumption.

On the insurance service results, Life Finance delivered EUR 98 million this quarter with the CSM amortization of 7.5% in the quarter. Adjusted for small one-off from Q2 and FX effect, the year-to-date CSM amortization stands at 7%, not far from our Forward 2026 guidance of 6.5%.

Overall, we delivered over the first 9 months an ISR of EUR 334 million, in line with our annual guidance of EUR 400 million.

On experience variance, this is fully in line with our expectations year-to-date. In Q3, the impact of onerous contract were a little bit higher, partially driven by an increase in the risk adjustment and other reserve movements. This remain contained in relation to the size of our portfolio.

Moving to investments. We continue to benefit from a strong performance with a return on invested assets of 3.3% this quarter, generating an income of EUR 190 million. This comes from a regular income mill of 3.5% as well as from a real estate impairment this quarter and slightly higher ECL expected credit losses in the quarter.

This creates no specific concern. The quality of our credit invested portfolio is very high.

The economic value stands at EUR 40 per share, flat compared to the start of the year. Year-to-date market variance had a negative impact as expected on our reported economic value. At constant FX, our EV growth stands at 12.7%, supported by both the positive evolution of our IFRS 17 shareholder equity and the growth of CSM.

With this, I will hand over to Thomas to start the Q&A session.

Thank you very much, Francois. On Page 17, you will find the forthcoming scheduled events. With this, we can now move to the Q&A session. Can you remind -- can I remind you to limit yourself to two questions each?

With this, operator, can we move to the first question?

The first question comes from Hadley Cohen, Morgan Stanley.

I appreciate you're very satisfied with the results, and I can -- I think I can understand why but I'm not sure that the share price necessarily agrees today. In that context, can you help us unpack what's going on in the solvency ratio, please? So you've got EUR 200 million a bit higher than that earnings, less EUR 80 million for dividend accrual. And you say that there's seasonally lower, no new business value and market neutral.

But even so, I'm still not sure why the solvency ratio is lower. And in that vein, I sort of wonder, how much of that is impacted by the fact that you are building buffers in the reserves?

I know you haven't quantified the buffer build year-to-date, but is it possible to give us a sense of how much higher solvency might have been if you hadn't done that? And then linked to this, given the buffers are now twice as big as you initially intended, how are you thinking about further buffers from here, given people clearly want to see growth in the solvency ratio?

I mean there's a few questions in there. So maybe I'll just leave it at that for the moment.

Thank you Hadley for your two questions. I agree with you, given the share price reaction, that's probably the two hot topics of the day. Let me come back a little bit on what we said in Forward 2026. You remember when we published Forward 2026 in September 2023, we mentioned that it was a plan where our expectation was a capital generation in terms of solvency ratio of 1, 2 points per year. So that's the guidance, and we reiterate the guidance.

Now let's look a little bit at the seasonality of the evolution of the solvency ratio during the year. The 1/1 renewal on the P&C side are booked in VNB the in Q4 and in Q1. The April renewal are booked in Q2 -- in Q1, the June, July renewal are booked in Q3, so -- in Q2.

So we don't have in Q3 renewal on the P&C side. So it's a low quarter. It's a seasonality effect. It's a low quarter on the P&C, VNB in the solvency ratio.

Let's look at what is happening on the capital deployment side. On the capital deployment side, we deploy each quarter the same amount, Q1, Q2, Q3, Q4. So there is no seasonality in the deployment of the capital in the solvency ratio quarter-after-quarter. And we adjust at the end of the year with the full year on the full capital deployment over the year.

So that's basically the dynamic of the solvency ratio for a given year. Now let's look at what is happening in Q3 and over the first 9 months.

We started 2025 with the solvency ratio 31st of December 2024 at 210. We were at 212 at Q1. So you could expect, given what I said, that the solvency ratio should have increased in Q2. And in Q2, we were at 210, if you remember the call end of July, and if you look as well at the work of the economic value in Q2, we mentioned during the call that Q2 was affected by a significant weakening of the dollar against the euro, which is our consolidation currency.

And on top of it, which was historical, it was also a strengthening of the euro versus all the currency we model in the internal model. So I mentioned it. It's a couple of points of impact in Q2 due to market variance. That's the point we are missing today, but they were already there. So the solvency ratio slightly decreased in Q2, where the expectation is still an increase in Q2. The fact that versus Q2 -- Q2 versus Q3, we don't create a lot of capital is expected.

So now what is happening in Q3, let's look in detail. On the P&C side, so we have a low VNB due to a very low amount of renewal. We have, of course, the good Cat ratio, but we have the higher attritional ratio this quarter linked to those mid -- small and mid and midsize events I mentioned during my speech, We still accrue the dividend of last year on a quarterly basis. So that's 2 points.

The good news is that the market variance impact in Q3 is under control. We made a lot of progress on ALM during the summer, especially by additional hedge on the dollar. We have the early refinancing of the debt, which brings 3 points of solvency. And we have a one-off impact of minus 1 point, which is linked to restructuring of internal retrocession between one subsidiary and the motor company.

So you have the work. But again, look at the first 9 months, the guidance of Forward 2026, what is missing today is not linked to Q3 is the market impact of Q2 that we disclosed end of July.

You had a second question, I think, on the buffer...

The extent to which the -- I mean, is the -- and thank you for the first response. But I'm just wondering, does the quantum of the buffer build impact the OCG, i.e., if you hadn't built the buffers to the extent that you have done this year, would OCG have been higher? And I guess, more fundamentally, why is OCG on a normalized basis as low as it is 1 to 2 points?

Let me reexplain what we said in the past. So we have prudence in the bill, so under IFRS and under Solvency II. So that's the prudence in the -- on top of this prudence on top of this prudence, we decided with Thierry since July 2023 to add P&C buffers. That's on top of the prudence we have already in the bill. So we added those buffer between July and today. You know that we mentioned that at the end of 2024, we were significantly above the target of EUR 300 million.

We mentioned today, and that's in the quote in the press release that the amount accumulated in Q1, Q2 and Q3 is of the same magnitude of what we did for the entire year 2024. We always mention that those buffers are in the risk adjustment. They are in the risk adjustment. So we confirm that they are in the risk adjustment and those buffer have no impact on the capital generation.

Operator, can we take the next question, please?

Next question is from Michael Huttner, Berenberg.

I had two. So the first one is on the attritional. Can you give us a little bit more color because the variance -- I know you say lots of little ones, but the variance is huge, right? So you go from 76% Q3 last year to 79% Q3 this year. And presumably, there's less buffer building, whatever. So the -- maybe if you adjust for that, it's probably a 5-point change or something. So it seems a lot. So any insight as what happened and where it is because then we can kind of think where it might not happen, whatever, anyway, it would be very helpful.

And then the other one is a more general question. The word Tier 1 was mentioned, I don't know, 6 or 7 times. So clearly, it is very important. It's core to the story. I don't quite understand what it means. My guess is it means that you think you're underrepresented in your clients' wallet in terms of market share and things. But I don't know how you can increase that in a period when prices are falling. It doesn't -- it seems quite hard. But I'd be really interested in how quickly you could close the gap and how big you see it.

Okay. Thank you for your question. I'll start -- this is Jean-Paul. I'll start with the attritional loss question. So this quarter, in Q1, Q2 this year, we've had really exceptional attritional losses with very limited man-made losses and very good attritional losses. which allowed for a very strong buffer building. In Q3, we saw the loss activity reverting back to what I would call a normal activity.

As Francois said, it was an accumulation of small to medium-sized losses across both property and casualty. And what we've decided is to basically take these losses to the P&L, absorb as little as possible in the IBNR and then revert to the Q4 reserve review to review a level of adequacy on the overall reserving.

As Francois has already mentioned, the preliminary results from the Q4 review show that there is no strengthening needed on our overall attritional losses. So we're very comfortable with our reserving level where it stands today.

And is there anything unusual about them? Is it like, I don't know, political risk or something just to give us a little bit of color? Or is it just normal?

No, I'd say it's normal. What was not normal was the loss activity in Q1, Q2. Here, again, it's a mixture of different lines of business, not really political risk. As I said, it's more property and casualty. And I'd say it's back to what I would call a normal level of loss activity. It's just the -- what you would expect in terms of the fluctuations quarter-to-quarter.

Just adding a point, Michael, if you normalize the combined ratio over the first 9 months, you normalize for the Cat effect and for the discount effect. You will find a combined ratio of 87.4%. So it's exactly in line with the guidance of Forward 2026. Remember, we said in Q1, we accelerated the buffer strategy. We said the same thing in Q2.

Here, it's a lower amount, but still -- we still have buffer in Q3. Again, the magnitude is the same over the first 9 months. So inside this 87%, you have a couple of points of prudence. So -- and excellent underlying performance. And again, take my statement also on what I see again as overseeing the reserve of the group. there is no concern on the reserve at the end of the year as of today.

And Michael, on your T1 question, it's true that I'm mentioning it quite a lot. And so it does help in both in a hard and soft market. So it's independent. And I'll try to explain it in the easiest and quickest way. But if you just generally have clients that view you as a Tier 1 means they have a genuine and general desire to see us with a higher share on their programs than we have today. That's a good position, a good starting position for us.

That means that it should give us a tick better position when it is about choosing where we play on which programs we play and where we increase the shares and on which ones we might not wish to increase the share. So it should give us a tick better opportunity for growth and a tick better opportunity on the combined ratio side. That's what you are saying. And it's like a joker card that we have, and we intend to play. And I'm sure this is going to last for multiple years.

Next question is from Andrew Baker, Goldman Sachs.

The first on the tax rate. So clearly, it was good -- very good in the quarter, and you highlight in the release the ongoing improved profitability of the reinsurance activities under the French tax perimeter. Can you just remind me how we should be thinking about that for Q4 and then, I guess, more medium term, '26 and '27?

And then secondly, on the Life and Health onerous contracts, I appreciate, again, this is driven by the increase in the risk adjustment. But what led to this? Is this prudence? Or is there something going on in a specific line? So just how should we think about that risk adjustment increase?

Thank you, Andrew. So on the first one, on the tax rate. So we start to see in Q3 an improvement in the effective tax rate of the group. I've been quite vocal on the topic. We initiated a strategy in 2023 we need to repatriate more taxable profit to France to be in a situation to reactivate losses carryforward we've got off balance sheet and to use also the DTA we have activated on the balance sheet.

So you saw it in the past already last year. So we are well on track in all the restructuring of the group to repatriate more profit. It's mostly through restructuring of internal retrocession to bring more through quota share assets and profit in Paris. We are going to move probably at the beginning of the year, redomiciliate one entity from Ireland to France.

So the effect you see today is just a combination of -- we have now a larger base of profit located in France -- and then you have a second effect, just the excellent performance of the 3 business activities, which bring more profit. So you have those 2 effects. So if you look at the tax rate over the first 9 months, we are close to 27%. Is it a good indication of the future? What I can tell you is that compared to the 30%, it will improve.

Given -- I'm a French, given discussion at the French parliament currently on the budget for France in 2026, I prefer to wait a little bit to see what type of budget we will have in France. Let's see maybe during the call of Q4, if I change the guidance. I confirm it will improve. We are on track. Again, it's not yet linked to the consumption or the reactivation of the DTA. It's just the fact that we are more profit in France and they are just at the level which is exceptional.

On your second question on onerous contract on Life & Health. Let me tell you a little bit the way we see the performance of this portfolio, and that's what I said in the introduction, the way we -- and the way we guided the market during the IR Day of last September. So we have a year-to-date insurance service result of EUR 334 million. We gave a guidance last December of EUR 400 million per annum, so which means we are in line and we are even slightly above the quarterly guidance accumulated over the first 9 months.

I always mention, if you remember what I said during the IR Day and in the call after this year, I always mentioned that the EUR 400 million guidance includes a cautious buffer for contained volatility. And this volatility, which is normal given the size of our in-force could come from the experience variance or could come from loss component, again, given the size and the geographies of the in-force portfolio.

That's what we see. So if you look at the experience variance since the beginning of the year, so Q1, Q2, Q3, it's close to 0. So it's close to 0. If you look at the loss component, we have a little bit of noise each quarter, which is on our side within the budget we had in mind when we gave the guidance of EUR 400 million.

The guidance of EUR 400 million in our mind, and I was transparent on this fact, include a cautious buffer for volatility on experience variance and/or loss component. So again, it's normal, I would say. Keep in mind as well that there is -- we commented this a few quarters ago, there is an asymmetry in the treatment on the expense variance on the CSM and the expense variance on contracts which are already on.

On onerous, as soon as the contract is onerous, any movement, positive or negative flow into the P&L. More specifically, what is now happening on loss component this quarter is just a slight adjustment on group of contracts, which are already onerous and it's slight adjustment on the risk adjustment and also on one client, it's an adjustment on reserve movement.

So again, on our side, with Thierry, we are really, really satisfied with the overall performance of Life. coming from, again, the CSM amortization, the risk adjustment release and the expense variance and all the volatility on loss component. Last word, the stock of loss component of onerous contract, which we disclosed last year is unchanged as of today.

Next question is from Kamran Hossain, JPMorgan.

Two questions from me, both on the P&C side. The first one is just it was at the beginning of the call, a very kind of strong message from Thierry on discipline opportunities and how to avoid kind of pitfalls going forward. Just interested with, I guess, the cycle moving slightly south from where it is now into next year. does the 4% to 6% revenue target become less important now for SCOR?

So just trying to work out with that market coming down a little bit more discipline, is 4% to 6% still a priority or not really? And then the second question is, historically, you've been really big users of retrocession. And more recently, you've used a lot more other kind of capital relief measures, particularly last year.

In terms of the market for those, where do you think those will head into '26? Will they come down at the same rate as reinsurance? Will they come down more? What do you think the dynamics will be in that market?

Thank you, Kamran. So I'll take these questions. On the outlook and the revenue target, definitely, the revenue target is no longer, I'd say, a target for us. It will really depend on market terms and conditions. As Thierry mentioned, we expect a competitive market. especially in the Cat XL area. You have to remember, Cat XL represents only 10% to 12% of our overall premium income. And the market itself is coming from a very high price adequacy level.

So the -- I'd say, the decline of that market doesn't affect the overall pricing level of SCOR as much as it does some other peers. We see competition across all the lines of business, but to a much smaller extent. And a large proportion of our portfolio, over 70% is on a proportional basis, where it's more the driver of the insurance prices that drives the price evolutions.

On your second question regarding retro, we do expect that the retro market to also be competitive. The question as to whether it would be more or less competitive than the reinsurance is a little bit early to tell. We do see on the retro side, even though there's a smaller number of players, we do see all those players having appetite to grow more in terms of limit deployed as well as in terms of different lines of business they want to write. So we do expect to have opportunities to optimize our retro program again this year.

Next question is from Shanti Kang Bank of America.

I just had two. One is on P&C. So I was just looking at the discount rate for 3Q, that's increased to 8.4%, but we had lower cats in the quarter. So I'm a bit confused why that's increased. It's also higher year-on-year. And last year, we had a hurricane in Q3. So maybe it's on the man-made losses, I'm not sure, but just information on that would be helpful.

And then on Life & Health, on that new business CSM target, what's the execution risk to that EUR 400 million? Can you tell us a bit more about the pipeline and your new business CSM numbers just to get us a bit more comfortable about meeting the guidance given the softness today?

Thank you Shanti. I will take the first question, and Philipp Ruede will take the second one. So on the P&C discount, so we have a discount rate at 8.2% in Q3 compared to the guidance of 6% to 7%. If you remember, it was 6.3% in Q2. Here, it's just the impact of those small midsized man-made losses that we see in the quarter, which affect mechanically the discount. So it's just a mechanical effect of the man-made losses of Q3.

Yes. So on your second question, I would say this type of fluctuation is normal. The longevity and financial solution deals are lumpy by nature. And so we remain confident that with our guidance as previously given, which was EUR 400 million, but actually for next year, and if I refer to previous communication, we expected a more significant drop in protection as we redress the portfolio and the delivery of the protection this year is actually ahead of our expectations.

In terms of Financial Solutions, the pipeline is growing, but I would say it's fair to say that the execution takes longer, and you could say maybe it is a bit delayed. Whereas on the longevity side, our pipeline is robust, both in the short and the medium term. and that pipeline is global in nature, so not restricted to the United Kingdom. So hopefully, that answers your question.

And just -- sorry, just on that, you implemented some profitability thresholds, I think, in December in 2024. How is that emerging in the Life and Health side? Are you seeing any pushback? Could that have really attributed to some of the softness that we've seen today or?

No, no. I mean it's rather the opposite, right? We expected to lose a lot more business with these rates increase, and we were able to retain more of the business at these increased rates. And that's why I said in terms of protection that we are ahead of our expectations.

Next question is from Chris Hartwell, Autonomous Research.

Just a couple of quick questions from me. Firstly, just on the subject of the buffer. I mean you're now -- you must be getting towards sort of 3/4 of the P&C reservice result, which obviously a lot higher than what you were originally anticipating. And I guess sort of I suppose part A of the question is, how much more scope do you think there is to move this higher?

And secondly, I think given the sort of initial comments around the market environment as things stand currently, I mean do you think that the industry profitability is enough to support further buffer build? And then second question, I just wanted to actually come back to the previous one on discounting. I agree I'm also a little bit confused by this.

And I would have thought that this would be more to do with longer tail or longer duration claims rather than the sort of small and midsized sort of mandates that you were talking about, unless I'm sort of mixing those 2 up. So just wondering if you could sort of help to clear that up for me as well, please.

Chris, so on your first question, so on what we can do in the future, we were clear since 1st of January 2025 with Thierry, we build opportunistically buffer. Jean-Paul mentioned that the level of the attritional loss and commission ratio was exceptionally good in Q1 and Q2. So we mentioned that we accelerated the buffer strategy -- we still have room of maneuver in Q3 to put a smaller amount of buffer.

Is it the end? No. Should you see this systematically each quarter? No. And you can expect over the next few quarters and year with the softening of the P&C market, of course, probably we will reduce the pace of implementation or we will find less and less opportunities to build buffer. But that's not for tomorrow.

That's not for tomorrow. We have probably still a few quarters in front of us with still excellent margin on the P&C side. On the second question on the discount rate. So again, I mentioned it's small and midsized man-made losses. You're right. If there is an impact on the discount, it means that long-dated claims, so it's related to casualty.

Okay. And just on that casualty point, can you give a little bit more color as to if there's any particular lines of business within casualty that those claims have materialized?

Chris, this is Jean-Paul. So it's a little bit, I'd say, random. It's GL on the treaty side, on the SBS side. It's some financial lines again on the treaty and SBS side. There's no particular trend. But it's -- as Francois said, it's more underwriting years that date back 3, 4 years and therefore, have an impact on the discount rate.

And again, you mentioned it. I mean, we could have the choice to absorb those man-made losses in Q3 through IBNR. We did not. So we don't do it. So the bad news is in the attrition, and we wait for the outcome of the P&C reserve review in Q4. You can imagine that we are well advanced in this review. So my statement on the fact that we should not expect impact on the P&C reserve at the end of the year include, of course, the review of the casualty book. So I confirm what Jean-Paul is saying. There is no trend identified as of today.

Next question is from Iain Pearce, BNP Paribas Exane.

It's just coming back to the capital generation point. So I understand that you're saying that the capital generation that you've achieved has sort of been in line with the guidance that you gave at the start of the year. But I guess in Q3, we've had positive experience, particularly in the P&C business.

So if we just look at cat relative to expectations, you take out the buffer, which shouldn't impact the Solvency II numbers, you would think that, that would positively contribute to the solvency. So the solvency in Q3 should be developing better than what you guided to at the start of the year.

Now I guess the only thing that could offset that is the man-made claims that you're referring to, but I wouldn't guess they're at the same quantum of the level of cat benefit you've had. So I'm just understanding why that positive experience hasn't come through in the capital generation. I don't really understand that. So if you could try and elaborate on that, that would be really useful.

Thank you, Iain. Capital generation in Q3. So if we look at the P&C contribution, we have, as I mentioned it, the good news of the Cat, but that's compensated by the higher attritional ratio. It's almost not one for one, but I would say it's almost an impact, which has the same size. So which means the good news is offset by the attritional losses this quarter, and it's almost a one-for-one impact. You don't have the impact of the buffer, of course, in the solvency ratio.

Well, I guess if the man-made is offsetting the nat cat by 1: 1, and that's implying EUR 100 million of man-made increase versus expectation in the quarter. I mean that's a pretty high number.

Yes, if you want more precision when I say -- I said that the capital generation on the P&C side was low. So it could be still a little bit positive. So -- but again, the order of magnitude of the man-made losses this quarter offset in a good portion, the good news on the Cat side.

Next question is from Darius Satkasukas, KBW.

Two, please. So you suggested that the pace of the buffer building in P&C will slow down as the market softens. Is the intention here to limit the soft market pressure to your combined ratio and you see this buffer as a tool to achieve this? And that's why you're making such a comment.

So we shouldn't essentially expect the sort of the opportunistic thing to continue and the benefit to come through the reserve releases, you will actually manage down how much you're adding if market softens. So that's the first question. And the second question, just on the Life & Health. I'm slightly confused why have you been making allowance for volatility in your ISR target?

If you have been conservative in your assumptions in the recent review, wouldn't we expect to see positive experience more often than not? So these negatives in both P&L and CSM and the allowance rates are a bit surprising.

Thank you, Darius. So the first question, if I catch your point is basically when we are going to use those buffer. So the way we see it is really to manage in the future the volatility. So it's not to manage specifically a cycle. Maybe we will be really at the bottom of the soft cycle, but it's really to manage the volatility of the book. So that's all.

Maybe there was another part of your question, Darius, is the buffer building, will the pace come down, right, given the market environment. So we very much feel in 2024 in terms of IFRS reporting, we were very much in a very attractive environment. We think we will remain in a very attractive environment next year.

So we do not foresee necessarily -- again, it's opportunistic, so we can never give -- make a prediction. But we continue to believe that also next year, we should be able to build significant buffers if the results come in as expected.

And your second question on Life & Health and the way we set the ISR target. So that's true. I mean we did this significant assumption review in 2024. Then again, that's what I said, given the size of the in-force, given the geographies of the portfolio everywhere in the globe, given the underlying nature of all the existing treaties, we will have some volatility.

So this volatility, I agree with you, this volatility could be negative or could be negative and could be on the experience variance side or it could be through a loss component onerous contract. We want to be cautious. We want to be cautious.

And I agree with you, on an average, over a long period of time, this volatility should be around 0, again, with plus and minuses quarter after quarter, but it should be around 0. to be on the safe side, and we mentioned it to be on the safe side, the EUR 400 million guidance include a buffer to take into account any residual volatility that could be negative or positive, but we prefer to give a guidance and to underpromise and over deliver on the guidance.

So if I understood Thierry correctly, the -- what you've done in terms of reserve buildup, that's for the volatility. But in terms of how much you will do going forward, you can very much manage the combined ratio in a soft market.

Yes.

Next question is from Ivan Bokhmat, Barclays.

I've got 2 questions left. We've been talking about the Q4 reserve review for the P&C business. I was just wondering if you can update us on how periodically would you review the Life book? Is there a review coming in Q4? Maybe any early findings there?

And the second question is related to the investment results. I think in Q3, you have flagged some higher real estate amortization during the quarter. Could you give a little bit more color on that of which portfolios or geographies that might relate to? Do you anticipate any additional charges such as this later?

So on the first question on the Q4 reserve review, -- so we did -- we took an external opinion in 2023 -- in 2024 with the same actuarial firm. So we list our [ Watson ]. I remind you that our Watson confirmed last year that we have increased the level of credence compared to 2023. We have been sharing this, and we -- I like to listen to the feedback of our investors on the topic.

I'm not sure that bringing such a review each year will be useful. So we are listening with Thierry to recommendation or question or suggestion from investors or from you as analysts. So let's see the periodicity, but probably every 2, 3 years should be the good cycle. On your second question on the investment portfolio, so that's true that we have mentioned it, an impairment on the real estate asset.

So it's a property asset that we own in France. We decided to significantly to invest and to do some CapEx to restructure this building. But first, when you invest, you have first to impair the building, then we are going to deploy the CapEx. And one day, we're going to lease it and sell it with a gain.

So we are in the cycle of real estate and the DNA of the team is really what we call value-add -- so we like to restructure assets, and that's one we have and we impair it. So it's EUR 12 million. So it's not a trend. It's not something that just because we invest to value this asset, and we have to impair it a little bit before we start the renovation and the restructuring works.

And maybe just to follow up on this and broaden the question a little bit.

So which means if you look at -- because in the line real estate amortization and impairment, you have the impairment, it's almost EUR 12 million this quarter. And I would say normal amortization, that's the amortization compared to the book -- the historical value. So the amortized costs flow into the P&L and roughly, it's a budget of EUR 5 million, EUR 6 million per quarter.

Okay. And maybe if I could follow up on this question. And more broadly, if you can talk about the private assets that you hold, is there anything that make you concerned in the current environment?

No. I mean I've got -- I mean, you know that we have a positioning of the investment portfolio, which is highly defensive. The fixed income portfolio has a very high quality. The average rating is A-. Our exposure to private debt, private assets is fairly limited. We disclose it every quarter. If I take the collapse of first brands and Tricolor a few weeks ago, it was an indirect exposure on the investment side of EUR 0.2 million.

So it's nothing, and it's a single low-digit number on the credit and surety side. So we don't change anything. We don't change -- I mean, we don't have any concerns, so we don't change anything on the asset allocation. And just remind you, since I mentioned all the discussion we have at the French parliament on the budget for 2026, I remind to everyone that we have 0 exposure at all to French.

Next question is from Will Hardcastle, UBS.

Just two. The first one is clarification really. I'm trying to understand the manmade. There's been a couple of confusing messages. You said clearly, it was above budget, I think, in Q3. Where is it year-to-date? I'm trying to understand just how much better than a budgeted type level H1 was?

And the second question is just on P&C revenue. I think I just heard you say that, that 4% to 6% revenue CAGR and P&C target no longer stands. Is that right? Have you officially walked away from that?

Thanks, Will. I will take the first question and Jean-Paul, the second one. So I mentioned it, normalized for Cat and discount, the normalized combined ratio would stand at 87.4%. I mentioned that inside, you have a significant amount of buffer. It's a couple of points. And do not forget that the combined ratio published or normalized include a significant amount of buffer. So it's included in the attritional ratio over the first 9 months of 79.2%.

Hopefully, that reassures you that, again, the level of man-made we've seen year-to-date has been very low. Q1, Q2 was very low. Q3 is normal. So when you average it across the 9 months, it's low. In terms of P&C revenue, what I meant is we don't change the guidance. But for us, the 4% to 6% is more an outcome than an objective.

We're not asking the teams to position the portfolio in such a way that we can absolutely meet this target. If the terms and conditions, we find them satisfactory and there's different price adequacy, we're ready to deploy capital and grow the book. If price deteriorate to a level that we think they're no longer price adequate, we're going to position the portfolio more defensively regardless of the guidance we've given on revenue growth.

And with this, we're going to take the last question of the call. Thank you.

The last question is from Vinit Malhotra, Mediobanca.

So almost all my questions have been answered. It's just -- and thanks for the clarification on the revenue growth. But just on the fact that you did grow U.S. Cat in July. And I'm just wondering whether what you know now, are you still happy with that decision to have grown?

And the reason I'm asking is, obviously, you talked about Cat XL being an area where there's most concern, which is only 10% of the book. but still your more cautious message on pricing, was it was still considering this cat action you took? And also one more question, if I can follow up on. I think somewhere in the call, you talked about U.S. casualty with core business Solutions having some larger claims. Is that the same thing that you're talking about this attritional manmade being normalized or was something else, sorry?

Thank you, Vinit. So on the U.S. Cat, we definitely don't regret our decision to increase our risk appetite in U.S. Cat. you're right that we expect the prices to come down at 1/1 and the market to be competitive. You have to remember the price adequacy of U.S. cat currently is very high. You can see despite the wildfires at the beginning of the year, the tornado activity throughout the year, the -- let's say, the profitability of that portfolio remains extremely good.

And our position is very much underweight in that market compared, for example, to Europe or to Asia. So we think there's opportunities for us to grow. In the renewal discussions, right now, the discussions seem to focus primarily on price. terms and conditions are remaining stable. Attachment points are remaining stable. So again, it's just a question of price.

And given the level of price adequacy where we stand, I think we still view that market as attractive and producing very good returns. On your question on U.S. casualty and SBS, again, I'd say it's normal activity. We don't see any concerns there. It's more prior underwriting years where losses have developed to a level that we took them to the P&L. our book today on SBS is very small.

We continue to take a cautious look at the U.S. casualty market overall, both on the treaty side and on the SBS side. We're following the market. The price increases on the insurance side is keeping up with loss trend, for example, in GL. The question is, is the price adequacy adequate. In our view, you have -- you probably need further years of similar price increases and no acceleration of the loss trend for it to be a price adequacy that meets our return on equity targets. So we're remaining very cautious today.

And the claims was not in treaty or P&C, but only in SPS?

No, no, the claims were -- there was a few claims on the treaty side, a few claims on the SPS side.

Gentlemen, we have no more questions registered at this time.

Okay. So thank you all for attending this conference call today. Our team remain available if you've got any follow-up questions. So give us a call. And with this, I wish you a good weekend. The Q4 2025 results call will be reported beginning of March on the 4 with a call as usual at 2:00 p.m. So wishing you a good weekend all.

Ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your devices.