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Shareholder Service
April 16, 2009
Dear Shareholder,
The history books for the
Financial Meltdown of 2008 are still being written and the effects of the
meltdown has certainly affected all of us as Americans and I doubt any of us
really know where the bottom is. If we have learned anything, it is that there
is probably no statement truer than “Value is Contingent and Debt is Forever”.
Our management team has worked
very hard to stay on top of the constant changing economic environment that we
now operate in and because of their hard work I am pleased to inform you that
we were able to end 2008 with Statutory Capital of $27 million and we paid an
additional $3 million on our debt. We will not have another principal payment
due until December of 2010, but plan to continue an aggressive debt repayment
and become debt free as soon as possible. Our Balance Sheet is very strong with
a majority of our investments in Agencies, Treasuries, and Cash.
In the past, part of our strategy
was to grow by acquisitions and actively pursuing Third Party Administration
(TPA). I cannot see us trying to acquire anything in the foreseeable future but
do believe when things stabilize and our debt is repaid we will have
opportunities at much lower prices than in recent years. We will continue to
pursue other TPA opportunities and believe we can leverage some of our excess
capacity for additional fee income in the future.
Our plan for 2009 is simple and
one that as a Shareholder I fully endorse, keep our investments safe, keep
expenses low, continue to pay off our debt, and keep our Capital strong.
It is a pleasure and honor for us to serve you.
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