Mount Logan Capital Inc. has announced its third-quarter 2024 financial results. The Canada-based multi-asset investment manager reported total asset management revenue of $3.8 million, a 20% increase year-over-year. The growth is thanks in large part to higher fees from the Opportunistic Credit Interval Fund (SOFIX), Collateralized Loan Obligations (CLOs), and sub-advisory services.
Mount Logan’s insurance segment generated $23.7 million in net investment income for the quarter ending September 30, 2024. This represents a 10% year-over-year decline due to a $1.1 million write-off of accrued investment income. Excluding the impact of reinsurance contracts and Modco arrangements, net investment income was $13.5 million, down 11% from the third quarter of 2023.
The insurance portfolio yielded 8.3% as of the end of the quarter, supported by optimized portfolio strategies and the impact of increased base interest rates. Excluding reinsured funds, the yield was even higher at 8.7%, reflecting the company’s focus on capital and portfolio efficiency.
The asset management segment’s Fee-Related Earnings (FRE) increased by 126% to $1.6 million for the quarter, driven by expanded fees from Ability, CLOs, Ovation, SOFIX, and sub-advisory services.
To further strengthen its investment portfolio, Mount Logan has entered into an agreement to acquire a minority stake in Runway Growth Capital LLC, an investment adviser overseeing $1.4 billion in private credit assets.
This acquisition, expected to close by the end of 2024, will be made alongside BC Partners Credit, who is purchasing the majority stake. The transaction is part of Mount Logan’s long-term strategy to expand its portfolio across private credit investments, enhancing its risk and return profile.
Ted Goldthorpe, CEO and Chairman of Mount Logan, said: “We are excited to announce our third quarter 2024 results, which demonstrate the earnings power of both our asset management and insurance segments. Fee Related Earnings, or FRE, of the asset management segment was up significantly year-over-year and highlights the growing profitability of our asset management business.
“Additionally, our Spread Related Earnings, or SRE, highlights the continued profitability of our insurance segment. The integration of our businesses and focus on profitability are driving consistent improvements in operating performance, while we focus on creating scale through organic and inorganic growth initiatives, which includes the recent Runway announcement.”
