Variable Interest Entities and Noncontrolling Interests (Tables)

6 Months Ended

Jun. 30, 2017

Carrying value of assets and liabilities of variable interest entity

The following table provides the carrying amount and balance sheet caption in which the assets and liabilities of Watford Re are reported:



	June 30,		December 31,
	2017		2016
Assets
Investments accounted for using the fair value option	$	2,129,436	$	1,857,623
Cash	63,929		74,893
Accrued investment income	13,229		17,017
Premiums receivable	193,769		189,911
Reinsurance recoverable on unpaid and paid losses and LAE	28,267		24,420
Ceded unearned premiums	20,455		12,145
Deferred acquisition costs	91,183		86,379
Receivable for securities sold	32,618		1,326
Goodwill and intangible assets	7,650		7,650
Other assets	132,068		111,386
Total assets of consolidated VIE	$	2,712,604	$	2,382,750

Liabilities
Reserves for losses and loss adjustment expenses	$	643,424	$	510,809
Unearned premiums	314,446		293,480
Reinsurance balances payable	17,623		12,289
Revolving credit agreement borrowings	186,452		256,650
Payable for securities purchased	224,152		42,922
Other liabilities	119,928		88,976
Total liabilities of consolidated VIE	$	1,506,025	$	1,205,126

Redeemable noncontrolling interests	$	220,436	$	220,253

Activity in non-redeemable noncontrolling interests

The following table sets forth activity in the non-redeemable noncontrolling interests:



	June 30,
	2017			2016
Three Months Ended
Balance, beginning of period	$	868,186		$	754,915
Amounts attributable to noncontrolling interests	9,346			33,716
Foreign currency translation adjustments attributable to noncontrolling interests	(76		)	(42		)
Balance, end of period	$	877,456		$	788,589

Six Months Ended
Balance, beginning of year	$	851,854		$	738,831
Amounts attributable to noncontrolling interests	25,670			49,958
Foreign currency translation adjustments attributable to noncontrolling interests	(68		)	(200		)
Balance, end of period	$	877,456		$	788,589

Activity in redeemable noncontrolling interests

The following table sets forth activity in the redeemable non-controlling interests:



	June 30,
	2017		2016
Three Months Ended
Balance, beginning of period	$	205,644	$	205,274
Accretion of preference share issuance costs	92		92
Balance, end of period	$	205,736	$	205,366

Six Months Ended
Balance, beginning of year	$	205,553	$	205,182
Accretion of preference share issuance costs	183		184
Balance, end of period	$	205,736	$	205,366

Portion of income or loss attributable to third party investors

The portion of Watford Re’s income or loss attributable to third party investors, recorded in the Company’s consolidated statements of income in ‘net (income) loss attributable to noncontrolling interests,’ are summarized in the table below:



	June 30,
	2017			2016
Three Months Ended
Amounts attributable to non-redeemable noncontrolling interests	$	(9,346	)	$	(33,716	)
Dividends attributable to redeemable noncontrolling interests	(4,586		)	(4,586		)
Net (income) loss attributable to noncontrolling interests	$	(13,932	)	$	(38,302	)

Six Months Ended
Amounts attributable to non-redeemable noncontrolling interests	$	(25,670	)	$	(49,958	)
Dividends attributable to redeemable noncontrolling interests	(9,170		)	(9,173		)
Net (income) loss attributable to noncontrolling interests	$	(34,840	)	$	(59,131	)

Total assets and maximum exposure to loss associated with VIEs

The following table presents total assets of Bellemeade I and Bellemeade II as well as the Company’s maximum exposure to loss associated with these VIEs:



			Maximum Exposure to Loss
	Total VIE Assets		On-Balance Sheet		Off-Balance Sheet		Total
Bellemeade I	$	129,475	$	489	$	1,165	$	1,654
Bellemeade II	238,310		58		929		987
Total	$	367,785	$	547	$	2,094	$	2,641