Fairfax Financial Holdings Limited said shareholder earnings fell in the third quarter as investment results swung to a loss, outweighing stronger adjusted income from its property and casualty operations.
Fairfax’s share of quarterly earnings was $929.6 million for the three months ended Sept. 30, below $1.1517 billion in the year-earlier period. Diluted earnings per share were $43.32, down from $52.04. All dollar figures are in U.S. dollars.
The investment line reversed from a $426.2 million gain in the third quarter of 2025 to an $858.7 million loss in the latest period. Fairfax cited interest rates as the main factor behind $827.7 million in bond losses. Preferred shares recorded $257.9 million in unrealized losses, primarily related to Digit, while equity exposures produced $176.9 million in net gains. Rate changes to insurance contracts and reinsurance contract assets generated a $679.3 million net benefit, partly offsetting the bond losses.
Property and casualty insurance and reinsurance operations produced $1.375 billion in adjusted operating income, compared with $1.3432 billion a year earlier. The operations wrote $8.9369 billion in gross premiums and $6.907 billion in net premiums, up 9.3% and 5.4%, respectively. Underwriting profit eased to $523.9 million from $540.3 million, and the undiscounted combined ratio rose to 92.5% from 92.0%. Fairfax said severe weather in Canada raised catastrophe losses at Northbridge, while Odyssey Group faced higher attritional losses and underwriting expenses. The company classifies adjusted operating income and several insurance measures as non-GAAP or other financial measures.
At Sept. 30, Fairfax’s holding company had $1.9353 billion in cash and investments. It also held $2.4 billion in investments in associates and consolidated non-insurance companies at fair value, and had not drawn on a $2 billion revolving credit facility. “We remain focused on being soundly financed,” Chairman and CEO Prem Watsa said.
Separately, Fairfax said its subsidiary 10955230 Canada Inc. had been selected as strategic buyer for a 60.72% stake in IDBI Bank. India’s Ministry of Finance listed consideration of 52,878.08 crore rupees, while Fairfax put the value at about $5.6 billion. Fairfax said definitive agreements had not been entered into and approvals were required. The company’s results call is scheduled for Wednesday, Nov. 4, at 8:30 a.m. ET.
