Good morning, and welcome to Fairfax's first quarter results conference call. Your lines have been placed on a listen-only mode. After the presentation, we will conduct a question and answer session. And at that time, to ask a question, please press star one on your phone keypad. For time's sake, we ask that you limit your questions to one. Today's conference is being recorded. If you have any objections, you may disconnect at this time. Your host for today's call is Prem Watsa, with opening remarks from Mr. Derek Bulas. Mr. Bulas, please begin.
Good morning, and welcome to our call to discuss Fairfax's 2021 first quarter results. This call may include forward-looking statements. Actual results may differ, perhaps materially, from those contained in such forward-looking statements as a result of a variety of uncertainties and risk factors, the most foreseeable of which are set out under risk factors in our base shelf prospectus, which has been filed with Canadian securities regulators and is available on SEDAR, and which now include the risk of adverse consequences to Fairfax's business, investments, and personnel resulting from or related to the COVID-19 pandemic. Fairfax disclaims any intention or obligation to update or revise any forward-looking statements, except as required by applicable securities law. I'll now turn the call over to our Chairman and CEO, Prem Watsa.
Thank you, Derek. Good morning, ladies and gentlemen. Welcome to Fairfax's 2021 first quarter conference call. I plan to give you some of the highlights and then pass the call to Peter Clarke, our Chief Operating Officer, to comment on our insurance and reinsurance operations and some additional financial details. Peter will be on all future calls. Unfortunately, Jen Allen could not be with us today because her mother-in-law passed away in the last few days. She will be back for the second quarter conference call. She is very much in our thoughts and prayers. Fairfax's net earnings were $806 million in the first quarter of 2021, which equates to net earnings per value per share of $28.91. Fairfax's book value per share in the first quarter increased by 6.1%, adjusted for the $10 per share common dividend paid in the first quarter, to $497 per share.
Net earnings of $806 million reflected both strong underwriting results and net gains on investments. Our net loss in the first quarter of 2020 of $1.3 billion, primarily from the effects of the pandemic, have reversed with net earnings of $2.3 billion in the last 12 months, and book value is up 18%. Our net loss on investments of approximately $1.5 billion at the end of the first quarter of 2020 completely reversed in 2020 with net gains of, remember, of $313 million. It increased further in the first quarter of 2021 by $842 million. In 35 years, we have never experienced swings in stock prices like we did in 2020. Stock prices have rebounded extremely well. Most importantly, our total float increased by 12% to $25 billion, and float per share increased by 13% to $949 per share in the last 12 months.
This is in the last 12 months. We think we are now in a virtuous cycle. Growth in gross premiums written, underwriting profits, and value investing were coming to the fore, working well. It is still early days. Our insurance and reinsurance companies produced a consolidated combined ratio of 90% in the first quarter, which included above-average catastrophe losses of $211 million, or 5.7 combined ratio points. Excluding cat losses, the consolidated combined ratio was 90.3%, with 17% growth in gross premium written on the back of a strong pricing environment. All of our major insurance companies generated combined ratios of less than 100%, despite a higher level of cat losses in the first quarter. More on this from Peter Clarke. In the first quarter, operating income was strong at $298 million.
Net unrealized gains on investments were $842 million, with gains on net equity exposure of $1 billion, partially are offset by net unrealized losses on bonds from rising interest rates. The net gains on equities included gains on BlackBerry, Bank of America, Stelco, and BDT. In accordance with IFRS rules, not included in the net gain number is mark-to-market movement on our investments in non-insurance associates and certain consolidated investments, which increased significantly in the first quarter by approximately $1.1 billion. Any gains or losses in these securities will typically only be accounted for when they are sold. We have provided a table in our MD&A on page 59 and 60 that provides the unrealized gains or losses on these securities.
Net losses on our bond portfolio were $166 million due to increasing interest rates primarily on our corporate bonds that were purchased in the first and second quarters of 2020. Unrealized losses were mitigated through net sales of $1.8 billion of our CoCo bonds in the first quarter of 2021 at a yield less than 1%, realizing gains of $145 million. As we've mentioned at our annual meetings and in our annual reports and quarterly calls, with IFRS accounting, that stocks and bonds are recorded at market and subject to mark-to-market gains or losses. Quarterly annual income will fluctuate. Investment results will only make sense over the long term. As I've said previously, long-term value investing has gone through a very difficult time for many years now.
Valuations of value-oriented stocks versus growth stocks, particularly technology, have never been so extreme, exceeding even the extremes of the dot com era in 2000. As the economy normalizes, we expect a reversion to the mean with value-oriented stocks coming to the fore. After the Pfizer vaccine was announced last November, we started to see this taking place. Two examples were made clear for you, and I mentioned this in the AGM that we had a few weeks ago. Fairfax India was selling at CAD 9.60 per share at the end of 2020. Well, its book value was more than CAD 16 per share. Today, it is up to CAD 12.50 per share, and book value is about CAD 18 per share. We think it is only a matter of time that Fairfax India exceeds its 2020 high and does exceptionally well as the Indian economy recovers from COVID-19.
The Indian government, as I said at our AGM, came out with an exceptional business-friendly budget recently. Last few days, recognizing the tough times in India due to the spread of COVID-19, we decided to donate CAD 5 million to India and also through Dexterra, our 49%-owned company, to help them build emergency field hospitals in the country. Our thoughts and prayers are with the people of India as they battle this wave of COVID-19 infections.
That was Fairfax India. The second example is Atlas Corp., formerly Seaspan, run by David Sokol and Bing Chen, closed 2019 at CAD 14 a share, went down to CAD 6.30 a share in March, and today it's back to CAD 14. Atlas is financially very strong, has expanded significantly recently, as I mentioned in our annual report, and has great management. We think it's only a matter of time before it exceeds its previous high.
We expect a significant return on our common stock portfolio as the economy continues to normalize. In early March 2021, Farmers Edge completed an initial public offering of CAD 144 million in exchange for approximately 8.5 million common shares of Farmers Edge. Prior to the IPO, Fairfax exercised its warrants and converted its convertible debentures for common shares, resulting in the company's controlling equity interest in Farmers Edge increasing to almost 60% on completion of the IPO and capital transactions. Farmers Edge now has no debt and a lot of cash on its balance sheet. Farmers Edge continues to be consolidated in our statement with a carrying value of CAD 213 million, while the market value was CAD 354 million on March 31st. On March 24th, 2021, Boat Rocker completed an IPO of CAD 170 million in exchange for about 19 million shares of Boat Rocker.
Prior to the IPO, the company converted its convertible debentures, just like Farmers Edge, to subordinate voting shares of Boat Rocker. Boat Rocker converted its preferred shares to subordinate voting shares and issued additional subordinate voting shares to a third party, resulting in Fairfax having an economic and voting interest in Boat Rocker of 45% and 56% on completion of the IPO and capital transactions.
Boat Rocker also has no debt now and lots of cash on its balance sheet. Boat Rocker continues to be consolidated in our statement with a carrying value of CAD 105 million while the market value was CAD 173 million on March 31st. We continue to have approximately CAD 1.4 billion at the holding company, predominantly in cash and short-term securities. Please note our cash in the holding company is to meet any and every contingency that Fairfax might face in this uncertain period.
We're not making any long-term investments with this cash other than to support our insurance and reinsurance operations. With the closing of the RiverStone Barbados transaction in the second quarter, we expect to continue to have $1.3 billion in cash and investment at the holding company with our credit facility fully paid off. At March 31st, 2021, the company's insurance and reinsurance operations held approximately $17.5 billion in cash and short-dated securities, representing approximately 40% of portfolio investments, comprised of $14.7 billion of subsidiary cash and short-term investments and $2.8 billion of short-dated U.S. Treasuries. Our investment portfolios will be largely unimpacted by rising interest rates as we have not reached for yield. As we've said in the past, this may well be the big risk in the economy today.
In fact, if interest rates go up, we would benefit because we have a lot of short-term, short-dated securities. We continue to invest with Kennedy Wilson in the first and first mortgages with a term less than five years, with a run rate of approximately $22 million in gross premium, and our insurance subsidiary is growing significantly. A huge focus on underwriting discipline, a portfolio of over $40 billion, and HWIC operating in a stock picker's market, which is what we think we are in now. All grounded on our fair and friendly culture that over 35 years we expect to generate a 15% return for our shareholders over time. In the past 35 years, we've had many years when our book value has grown 40%-50% and our stock price has increased 150%. In our minds, the best is yet to come.
I will now pass the call to Peter Clarke, our Chief Operating Officer, to comment on our insurance and reinsurance operations. Peter?
Thank you, Prem. Our insurance and reinsurance companies have had a great start to 2021. We grew by 17% over the first quarter of 2020, generating gross premiums written of CAD 5.4 billion. We also produced a combined ratio of 96% and CAD 149 million of underwriting profit, despite above average catastrophe losses for a first quarter. By comparison, underwriting profit in the first quarter of 2020 was CAD 103 million. On the underwriting front, Northbridge and Zenith reported the lowest combined ratios, being 87% and 88%, respectively. All of our major companies produced combined ratios below 100%, and in fact, with the exception of Bryte in South Africa, all our standalone companies had combined ratios under 100%. As mentioned previously, our growth premium for the quarter was up 17%, or CAD 800 million from the year before.
This growth has been made possible by favorable market conditions that prevail in many of our markets, but particularly in North America. Allied World grew its premiums by 28%, with growth especially strong in directors and officers and excess casualty segments. Odyssey Group's growth premiums were up 24%, with expansion in both its insurance and reinsurance segments. In Canada, Northbridge's top line expanded 19% in U.S. dollar terms as it continues to register double-digit rate increases. While these three posted the most impressive growth among our major companies, Brit, Crum & Forster, and Zenith were all able to expand their businesses this quarter as well. Of note, Brit launched its innovative follow-on syndicate Ki in the first quarter, which contributed to its growth rate of 10%. Growth was strong in many of our international operations as well.
Fairfax Brazil's gross premium grew 32%, our other Latin American companies grew 22%, Bryte grew by 8%. Overall, our international companies grew by approximately CAD 100 million year-over-year. We expect growth to remain strong as overall price levels continue to rise at double-digit pace. Our global footprint and exceptional management teams gives us stability to generate significant organic growth. In the first quarter, we absorbed 5.7 loss ratio points from catastrophes, largely due to the extraordinary winter freeze event in Texas, approximately one point or CAD 46 million of additional COVID losses. With respect to COVID, our inception to date losses now total up to CAD 718 million, of which approximately half is held in IBNR. Based on knowledge today, we expect these provisions to adequately cover our exposure.
At the same time, the pandemic is ongoing, as is much litigation, and therefore, there remains a degree of some uncertainty. In the quarter, we recorded favorable reserve development of $43 million. Our reserve position continues to strengthen as our companies expand with today's well-priced business. Another important side effect of the growth we are experiencing is the reduction in the expense ratio component of our combined ratio. Premiums are growing faster than our underwriting expenses, and nowhere is this more apparent than at Allied World, whose expense ratio dropped a full 2.4 points from 2020. In summary, we are very pleased with the quarter and our prospects going forward. Our decentralized system allows our companies to respond quickly to opportunities in their markets. In times when conditions are improving, such as they are now, this gives us an important advantage.
Now some comments on our investment results, our non-insurance companies' performance, and overall financial position, which Jen Allen would have made if she could have been with us here today. Interest in dividend income of $168 million in the first quarter of 2021 was down from $218 million in the first quarter of 2020 and primarily comprised of interest and income earned on high-quality U.S. corporate bonds and first mortgage loans that are secured by high-quality real estate in the U.S. and Europe. This is primarily in partnership with Kennedy Wilson, and also dividend income from common stock and long equity total return swaps. We continue to hold a significant portion of our investment portfolio in cash, short-term investments, and other short-dated fixed income. This position dampens interest income in the short term but protects us from rising rates and inflation, a trade-off we are willing to take today.
Net gains on investments of $842 million in the first quarter of 2021 were primarily comprised of net gains of $1 billion on long equity exposure, partially offset by net losses of $166 million on bonds due to higher interest rates and foreign exchange losses of $37 million. As Prem said, included unrealized gains on BlackBerry, Bank of America, Stelco, and BDT, to name a few. Our net losses on investments of $1.5 billion in the first quarter of 2020 have completely reversed in the last 12 months, with net gains on investments of approximately $2.7 billion over this time period. Now turning to the results of our non-insurance companies. In the first quarter of 2021, our non-insurance consolidated companies had operating losses of $85 million compared to losses of $34 million in the first quarter of 2020.
The first quarter of 2021 included a performance fee accrual of $56 million by Fairfax India versus a performance fee reversal of $48 million in the first quarter of 2020. Both these intercompany amounts are eliminated in Fairfax corporate overhead. Excluding the impact of the performance fees, operating losses for our non-insurance consolidated companies decreased to $29 million in the first quarter of 2021 from $82 million in the first quarter of 2020. A significant improvement. Many of our non-insurance consolidated companies have been affected significantly by the effects of COVID-19, especially our restaurant and retail businesses, Thomas Cook India and others. They have done an outstanding job navigating through the pandemic and we believe will rebound strongly when we get through this.
Please note the excess of fair value over carrying value of our non-insurance associates and certain non-insurance subsidiaries increased by CAD 681 million and CAD 397 million respectively, for a combined increase of approximately CAD 1.1 billion in the first quarter of 2021. The excess is not reflected in our book value per share. We disclosed this in our annual report and will continue to disclose it in the MD&A of our interim reports going forward. Finally, a few comments on our financial position. Our total debt to total capital ratio, excluding the consolidated non-insurance companies, increased to 30.2% at March 31, 2021, up from 29.7% at December 31, 2020. Primarily reflecting increased total debt principally related to our $600 million U.S. bond issue. The proceeds of our CAD 850 million bond issue was immediately used to pay down our 2022 and 2023 maturities, had no effect on our ratios.
Excluding the remaining $500 million on our credit facility, which we plan on repaying at the closing of our RiverStone Barbados transaction, our total debt to total capital ratio drops to 28.6%. From the proceeds of our $600 million U.S. debt issue, we're going to pay off additional debt in the second quarter, which will further reduce our leverage ratios. We expect our total holdco insurance debt of approximately $7 billion to drop closer to $6 billion in the second quarter, and we are focused on lowering our financial leverage over time. The liquidity position of the company remains strong. Our cash and marketable securities at the holding company was $1.4 billion at the end of the first quarter of 2021.
At the close of the RiverStone Barbados transaction, our cash and marketable securities at the holding company will be approximately $1.3 billion, with our credit facility paid off in full and no significant maturities until 2024. Now I will pass the call back over to Prem.
Great. Thank you, Peter, look forward to answering your questions. Please give us your name and your company name and try to limit your questions to only one so that it's all fair to everyone on the call. Amanda, we are ready for your questions.
Thank you. As a reminder, if you'd like to ask a question, please press star one. Our first question comes from Junior Ra with Private Investor. Your line's open.
Good morning. Congratulations on a wonderful quarter. Question for you guys. Did you guys increase your total return swaps in 2021 for Fairfax? Because it seems like it grew by CAD 500,000.
Yeah. We've had the ability to do that, Junior. We'll continue to look at it. We think it's a great investment for Fairfax, and we will continue to look at it as we go forward.
Okay. That's maybe about 7%-8% of the outstanding shares then, right? I think.
Yeah. I worked the math out. It's about 2 million shares and $26, right?
Yeah. That's what it is. Yeah.
Yeah.
Okay. Thanks, Prem.
That's approximately what it is. Thank you, Junior. Next question, Amanda.
Thank you. Our next question comes from Tom MacKinnon with BMO Capital. Your line is open.
Yeah, thanks very much. Just following up on the
Hey. Good morning, Tom.
Yeah, morning, Prem. Just following up on the long total return swaps. Is the total notional that you have in these investments over $2 billion, is that correct? Would that mean, I think that now that you've increased it in Fairfax, it would be nearly 1/3 of that is associated with the Fairfax stock. Is there any color you can give as to what other instruments are in, or other stocks or indices or whatever are in the remaining 1.5 billion or so in terms of what you have in terms of total return swaps long notional?
Yeah. Tom, in terms of Fairfax shares, as we said in the press release, we have about $730 million, 2 million shares at approximately $372 U.S. This is all in U.S. dollars. $730 million is the total return swaps in Fairfax. Of course, it's already doing well. The others, on an opportunistic basis, we've looked at buying some common shares, Tom, but they're not long-term, and they're the ones that we bought. Quite a bit we've already sold. We continue to look at opportunities but it's the short-term stuff.
Okay.
We're not going to hold these for a long period of time.
Okay. That's great. If I could just squeeze another 40% cash, where do you think you would want to deploy that? As I understand, what you have in terms of your equity holdings, if you include your investments in non-insurance companies and investments in associates, I think you're kind of at your internal max there. Would you think that if you were to deploy that cash, it would more than likely go into fixed income as opposed to equities?
Yeah. Tom, the big risk today, I say this many times. In the 1980s, Tom, interest rates were very high. Inflation was very high, and nobody expected to come down. This is in the 1981, 1982. Long Treasuries were like 14%, long Canadas were 16%, and nobody expected to come down. Inflation was high. Today, it's the opposite. 10-year Treasuries in the U.S. are lower today than they were in the Great Depression, and the only exception was last year. Last year, they went down to like 0.5%, but back to the 1.65%. The 1.65% is lower than in the Great Depression. Nobody sees inflation picking up. You heard the Federal Reserve. The Fed says it's transitory. You look at commodities, copper price is at the highest price it's been, a record high. Lumber prices are record high.
Steel prices are very close to a record high. Corn prices. Procter & Gamble is increasing prices. There's all sorts of price increases taking place. You've got the economy coming back. You've got pent-up demand. You get all the supply problems that takes place till things normalize. The big risk in our mind is inflation increasing, and you can't say how fast it increases, and interest rates increase. We saw in the last year, two-year rates in the U.S. or less, meaning two years, one year, six months, have been flat. 10-year rates have gone from 0.5% in January to, as I said, 1.65%. If you go further a little back pre-COVID, they're in the 2.5% area. That's the big risk we see. We'd rather not take capital loss.
We think the bond markets today have no margin of safety. You have to be very careful. We forgo interest and dividend income, interest income purposely. We can easily buy longer bonds and get a higher interest rate, but we think that is asking for capital loss. That's what we're doing, Tom.
Okay. Thanks for the color.
Sure. Thank you very much, Tom. Amanda, next question.
Thank you. Our next question comes from Jaeme Gloyn with National Bank Financial. Your line is open.
Yeah. Thanks. Good morning.
Hey. Good morning, Jaeme.
First question. It's great to see the leverage commentary and that starting to trend downward. On the flip side, I'm seeing the premiums to surplus ratio tick up nicely as you take advantage of the harder markets. Just wondering if you could talk about your capital position in terms of being able to continue to drive those premium growth rates in line with the hard markets.
Yeah. I'll take a crack at it and then pass it on to Peter. The markets are hard. Jaeme, price increases are taking place across the board, pretty well across the world. Our companies are exposed to property casualty insurance across the world, and they're taking advantage of it. Who knows how long it'll last, but if history is any guide, it should last for a few years. We have the ability to expand. We have the capital to expand. Our companies are very well capitalized. As Peter said, we've got the $1.3 billion at the holding company. Peter, your response, anything you'd like to add, Peter, to that?
Sure. Thanks. Hi, Jaeme. I think, last year we put some capital into our insurance and reinsurance operations. They started the year well capitalized and their premiums are growing, but they're growing profitably, so they're generating some significant earnings. Add to that the investments bouncing back. I think the earnings within the operations will fund the growth going forward. Generally right across the group, we're quite satisfied where we are on the capital front.
To add to what Peter said, Jaeme, I mentioned this in our comments on the call. This is a virtuous cycle, which means there are times, and the last time this really took place at any significance was in 2001, after September 11th, where premiums are growing, prices are, rate increases are taking place. You're growing your premium, underwriting profit, and big redundancy is built up in reserves that you only see over time. The cycle is virtuous right now. Our presidents, if you know them and you've seen them and you saw some of them in our AGM, they're all experienced veterans in the marketplace. They know how to take advantage of the business, and get paid. Basically, you're getting paid for the risks that you're taking. Insurance is a risk business, so you need to get paid.
If you don't get paid, then you, like our Zenith, then you keep premiums flat or you come down as they have been. Because there've been rate decreases in workers' compensation. Kari Van Gundy has done a tremendous job. This is a virtuous cycle. On top of that, sort of not different from 2001, because you'll remember, the peak for the dot-com boom was in 2000. In 2000, if you look at our annual reports, 2000 to 2002, 2003, stock markets all over the world led by the dot-com, led by Nasdaq, dropped by 50%. Nasdaq dropped by something like 75%. Our portfolios, our stock portfolios, went up 100%. That's 100%, because value investing came back into the fore, and it lasted for many, many years after that. We see a lot of similarities today when we look at the companies that we own.
We think not only as the insurance business in a virtuous cycle, but it's backed, as Peter was saying, by the fact that value investing is making a comeback. Jaeme?
Yeah, that's great. Thank you. My next question is around the expense ratio, and the commentary around that coming down. Can you just give me a little bit of color as to the sustainability of that expense ratio, or is that driven by any initiatives or changes in the operations, or is it more just a benefiting factor of the higher markets and the higher premium side?
Yeah. Jaeme, later, this is the advantage that Peter mentioned in his comments. I'll ask him to add after I just say this. That when premiums go up and up and up, one of the things we did in last year, with our president, we said, "You cannot use COVID-19 as a reason to reduce staff, to fire people." These are our loyal employees who've been with us for a long time. We said to each of our presidents, "You cannot use COVID-19 to reduce staff." We had no reduction in staff at all. Our employees are appreciative of that. For now, we're increasing our premiums, but we're not adding staff. Right. Jaeme, it's not any restructuring or any of that type of thing. Because these are all our loyal staff.
We're not adding to them, and they're working hard as we're writing more premium. Peter?
Yeah, I think the only thing just to sort of add to what you've already said, Prem, is that it's really when a lot of the expense ratio benefit's coming from the premium side, and especially when it's through pricing, right? Our premium's going up because of increased rates. You don't need additional expenses to support that.
That's where the biggest benefit is coming from. I should point out that all our companies are very cost conscious and focused on the expense ratio as well. We have benefited in the past 12 months too, from some lower expenses, generally related to travel and entertainment as everybody's been working from home and really travel has been non-existent.
Well, that's well said, Jaeme. What Peter was saying, it's because of the rate increases, like our 17% growth in that first quarter is mainly rate increases as opposed to volume. The expense ratio, our life being a great example, dropped almost by 200 points. Any other questions, Jaeme?
That's great. Thank you very much.
Thank you, Jaeme. Amanda, next question, please.
Thank you. As a reminder, if you would like to ask a question, please press star one. Our next question comes from Ken MacNeal with Richardson Wealth. Your line is open.
Thank you. My question is around BlackBerry.
Hi, Ken.
Hi. Are you restricted from selling BlackBerry? If you aren't, when it hit 36, did you sell any? If you didn't, why wouldn't you?
Thank you for the question. I think in the annual meeting we discussed this, I made the point that we were restricted. We were restricted from September last year to March 1st. The restriction was because our conversion price went from $10 to $6. What the SEC rules are, there is a short swing rule. If you transact in BlackBerry securities or any securities that you had issued to you, and they consider the convertible to be a new issue, you would have to give all the profits back to the company. We were restricted. There was no way. We checked it 10 times. We checked it once. We had no option but to wait. After we waited, as you know, the stock price came down significantly. That is where we are today.
Thank you.
Thank you.
That's a good question. Amanda, next question.
Thank you. Our last question comes from Mark Dwelle with RBC Capital Markets. Your line is open.
Yeah, good morning. A couple of questions.
Good morning, Mark.
No problem. I wanted to get an update on a couple of the transactions that are outstanding. The RiverStone Barbados and the partial sale of shares in Brit to OMERS. Particularly on the Barbados transaction, it seems like it has been delayed quite a bit from when it was originally expected to close. I am just curious what seems to be the hold up or what the timing looks like at this point.
Mark, this is dealing with regulatory bodies. You're right, we expected it to be completed by the first quarter. CVC very much the buyer of RiverStone UK, wants to buy it. It's discussions that CVC is having with the regulatory body, which is the PRA in London. We expect that it'll happen sometime in the second quarter. You're right, it's been delayed some.
On the OMERS and Brit transaction, is that still on track to close in the second quarter as well? I think that was what the original timeline was.
Yeah. They're simultaneous, right, Mark? They close at the same time because, of course.
I see.
When they close the CVC transaction, RiverStone UK, OMERS gets paid, I think, CAD 600 million plus for that investment. Is that right, Peter, CAD 600 million ?
That's correct, yes.
That makes perfect sense. I don't think I saw the distributor videos.
They go together.
before this morning.
Yeah. We have every reason to expect that they'd close together.
Okay, very good. The second question I wanted to ask about was the long equity total return swaps related to the Fairfax shares. You increased the total amount of notional in the quarter. I guess I had understood when those were originally taken out late last year, the notion was an opportunistic play on the Fairfax shares. You were a little bit cash constrained with some debt and trying to get these transactions closed. I guess this quarter, we also bought back stocks just in the ordinary course. I was curious why the continued increase in the size of the notional on the swaps rather than just direct that same cash flow to ordinary repurchases.
Mark, when you look at us, right, when we are buying back stock, our first thing: financially sound. Second thing is to make sure we take full advantage of the insurance marketplace, which we did in the first quarter, we expect to continue in the next few years. Those are very important. We look at our stock price, and we think it's very attractive. We think we're in the midst of a virtuous cycle we talked about in terms of the insurance business, which you're very familiar with. What perhaps people are less familiar with is value investing coming back in spades. You're seeing that in, I gave the example of Fairfax India and Atlas. Eurobank. Eurobank's book value next year will be about $50.
I've said this before, and I'll say it again, the Greek government is perhaps the best government in Europe, and they're doing all the right things, and you're getting a tremendous tourist season, tremendous attraction for capital investment. They understand that, they just did EUR 500 million, I think it was, at 2% for five years or six years. Eurobank is selling at, I don't know, a little less than EUR 0.80. It's got tremendous prospects. I go on to Bank of America, Stelco, Resolute, and on and on and on. At page 59, 60, we talk about that. These are big positions that we've had, that in 2019, at the end of the year, you could see it coming back. Then COVID-19 hit in early 2020. No one can forecast these things. It happened.
In our minds, all the delay, which was going to take place, which is as the economy expands, inflation, interest rates pick up. Mr. Biden's got all sorts of programs on top of the economy recovering significantly. Inflation picks up, interest rates pick up. The economy produces a huge amount of profits for all the companies that I just mentioned. Interest rates go up, and we've got a ton of cash that will benefit from higher income. We won't take capital losses, which people who reach for yield will do. We think our company is really well-positioned. We've got tremendous management. We're very excited. Our stock, I've said this many times about the stock myself, but we think our stock is very good value for long-term investors, which a lot of the people on this call are long-term investors.
That's why we continue to add to it, Mark, because we think it's going to be a very good investment. It already is, but we think it's just early days.
Okay. I appreciate the insights. Thanks very much.
Thank you very much, Mark. Amanda, any more questions?
Thank you. As a reminder, if you would like to ask a question, please press star one. One moment. At this time, we have no further questions on the audio line.
Thank you very much, Amanda. With no further questions, we thank you for joining us on this call, and we look forward to talking to you after the U.S. second quarter. Thank you, Amanda.
Thank you. That concludes today's conference. Thank you for participating. You may disconnect at this time.