Travellers - Did They Say Enough?

Travellers (TRV) reported what looked like pretty good numbers for a financial institution. They actually made money. Quite refreshing under the circumstances. But just take a look at how they go about telling you that they had some losses in investment portfolio.

First they say “Notwithstanding these lower returns, we continue to be very pleased with the high quality and diversification of our investment portfolio.”

Then they say “Net investment income in the current quarter was impacted by negative returns in the non-fixed income portfolio and very low short-term interest rates.”

And then “The non-fixed income portfolio, comprised substantially of private equity funds, real estate partnerships and hedge funds, recorded an investment loss of $164 million after-tax”

They never come clean and provide information on the portfolio. There is not enough transparency. They just expect the investor to be happy be passing comments about the decline of the portfolio.

The financial world is going to hell in a hand basket you would think that the management would understand that the way to trust is through extensive disclosure. Right now we just do not understand quite frankly anything about that portfolio.