8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 25, 2014

ALLEGHANY CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	1-9371	51-0283071
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

7 Times Square Tower, 17th Floor, New York, New York	10036
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 752-1356

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On February 25, 2014, Alleghany Corporation (the “Company”) issued a press release on the subject of its financial results for the three months and year ended December 31, 2013. On February 25, 2014, the Company also posted on its web site at www.alleghany.com the Financial Supplement relating to its financial results for the three months and year ended December 31, 2013. A copy of such release and financial supplement are furnished herewith as Exhibit 99.1 and Exhibit 99.2, respectively. The information hereunder shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1	Press Release, dated February 25, 2014
99.2	2013 Fourth Quarter and Full Year Financial Supplement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ALLEGHANY CORPORATION
Date: February 25, 2014	By:	/s/ John L. Sennott, Jr.
		Name:	John L. Sennott, Jr.
		Title:	Senior Vice President and chief financial officer

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INDEX TO EXHIBITS

Exhibit Number	Description
99.1	Press Release, dated February 25, 2014
99.2	2013 Fourth Quarter and Full Year Financial Supplement

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EX-99.1

Exhibit 99.1

ALLEGHANY CORPORATION

7 Times Square Tower, 17^th Floor

New York, NY 10036

ALLEGHANY CORPORATION REPORTS 2013 FOURTH QUARTER AND FULL YEAR RESULTS

NEW YORK, NY, February 25, 2014 – Alleghany Corporation (NYSE-Y) today announced its financial results for the three months and year ended December 31, 2013. Book value per common share¹ grew to $412.96 as of December 31, 2013, an increase of 8.9% from book value per common share of $379.13 at 2012 year-end. Total stockholders’ equity² increased to $6.9 billion as of December 31, 2013 from approximately $6.4 billion as of December 31, 2012.

Alleghany reported net earnings³ of $205.3 million, or $12.24 per diluted share for the 2013 fourth quarter, compared with a loss of $92.6 million, or $5.47 per diluted share for the fourth quarter of last year. For the full year 2013, Alleghany reported net earnings³ of $628.4 million, or $37.44 per diluted share, compared with $702.2 million, or $45.48 per diluted share for 2012. The fourth quarter and full year results for 2012 include an after-tax underwriting loss, net of reinsurance and reinstatement premiums, of $267.8 million from Super Storm Sandy. In addition, full year 2012 results include three hundred days of results of TransRe, as well as merger-related items associated with the TransRe merger, including a gain of $494.9 million resulting from the application of purchase accounting treatment, amortization of intangible assets of $253.3 million and transaction costs of $33.8 million.

Concurrent with the issuance of today’s earnings press release, Alleghany has posted a financial supplement to its website, www.alleghany.com, containing a number of schedules that provide additional detail pertaining to Alleghany’s financial results.

A summary of Alleghany’s pre-tax results for the three months and years ended December 31, 2013 and 2012 follows:

	Three Months Ended December 31,									Year Ended December 31,
	2013			2012			Change			2013			2012			Change
	(in millions)
Underwriting profit (loss):
Reinsurance	$	86.1		$	(102.4	)	$	188.5		$	334.0		$	266.7		$	67.3
Insurance		12.6			(119.6	)		132.2			86.7			(46.4	)		133.1
		98.7			(222.0	)		320.7			420.7			220.3			200.4
Net investment income		131.2			78.4			52.8			465.7			313.0			152.7
Net realized capital gains		136.5			38.0			98.5			232.1			157.9			74.2
Other than temporary impairment losses		(2.1	)		—			(2.1	)		(44.0	)		(2.9	)		(41.1	)
Other income		40.9			13.9			27.0			78.7			57.3			21.4
Other operating expenses		(67.8	)		(25.8	)		(42.0	)		(164.9	)		(123.7	)		(41.2	)
Corporate administration		(10.1	)		(8.1	)		(2.0	)		(36.1	)		(42.0	)		5.9
Interest expense		(21.8	)		(21.8	)		—			(86.8	)		(68.4	)		(18.4	)
Net earnings (losses) before merger-related items and income taxes		305.5			(147.4	)		452.9			865.4			511.5			353.9
Merger-related items:
Gain on bargain purchase		—			—			—			—			494.9			(494.9	)
Amortization of intangible assets*		1.4			(39.9	)		41.3			(10.2	)		(253.3	)		243.1
Transaction costs		—			—			—			—			(33.8	)		33.8
Earnings (losses) before income taxes	$	306.9		$	(187.3	)	$	494.2		$	855.2		$	719.3		$	135.9

* Includes immaterial amounts of ongoing amortization arising from the acquisition of subsidiaries other than TransRe.

¹  Stockholders’ equity attributable to Alleghany stockholders divided by common stock outstanding.

²  Stockholders’ equity attributable to Alleghany stockholders.

³  Net earnings attributable to Alleghany stockholders.

Weston M. Hicks, President and chief executive officer, commented, “Alleghany generated solid returns in 2013, growing book value per share by 8.9%. Our results were driven by strong underwriting performance both at TransRe and RSUI, resulting in a 90.1% combined ratio for the full year, as well as the total return on our investment portfolio, which was 3.3% for the year due largely to strong equity returns.”

“In our reinsurance segment, TransRe achieved the best underwriting result in its history and we continue to be impressed with the quality of the team and its business. TransRe’s combined ratio for 2013 was 89.2% in the fourth quarter and 89.9% for the full year. These were excellent results, particularly in light of the increasingly competitive environment for reinsurance. TransRe benefitted from a below average year for property catastrophe losses and favorable loss reserve development. Although gross premiums written for 2013 increased by 16.4% over 2012, this increase is inflated due to 2012 including only approximately ten months of TransRe activity. TransRe’s gross premiums written in 2013 were down by approximately 5% over full year 2012, which is more reflective of management’s highly selective underwriting approach in a challenging marketplace.”

“Our insurance operations recorded a combined ratio of 95.1% for the fourth quarter and 91.0% for the full year in 2013, driven by favorable results at RSUI which recorded an 80.2% combined ratio. In addition, RSUI was able to grow its premiums by 12.3% in 2013 through a combination of rate increases and new business. RSUI continues to be a meaningful contributor to our results. Underwriting profits at RSUI were somewhat offset by losses at Capitol and PacificComp. Although the performance of these two subsidiaries remains below acceptable levels, we are encouraged by the steps being taken by their leadership teams.”

Mr. Hicks continued, “Our investment strategy remains focused on balancing interest rate risk through the combination of an intermediate duration fixed income portfolio — a prudent position relative to our loss reserves — with equity security exposures that performed well as interest rates rose in 2013. For the year, our equity portfolio was up 35% compared with an increase in the S&P 500 of 32%. This outperformance occurred despite Alleghany holding meaningful cash to allow flexibility as opportunities arise. Our equity performance was especially important in 2013, as rising interest rates, and the corresponding drop in market values of our fixed income securities, essentially eliminated any fixed income investment returns. We believe that our previously-announced strategic relationship with Ares Management will provide an additional reduction to interest rate risk through an allocation to credit strategies with floating interest rates. Simultaneously, we have taken steps to provide some protection against the risk of a recessionary economy and allocated a portion of our assets to long-dated zero coupon Treasury securities. While this position was at a slight unrealized loss at year-end, subsequent market movements have shown the value of this hedge.”

In 2013, Alleghany repurchased an aggregate of 113,160 shares of its common stock in the open market for $40.4 million at an average price per share of $356.92. Following this activity, Alleghany had $241.9 million remaining on its currently effective $300 million share repurchase authorization.

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2013 Fourth Quarter Underwriting Results

Alleghany’s underwriting profit for the fourth quarter of 2013 was $98.7 million, compared with an underwriting loss of $222.0 million for the fourth quarter of 2012. The underwriting results for the 2013 fourth quarter reflect an $86.1 million underwriting profit for the reinsurance segment (TransRe), compared with an underwriting loss of $102.4 million for the 2012 fourth quarter, as well as an underwriting profit of $12.6 million for the insurance segment, compared with an underwriting loss of $119.6 million for the 2012 fourth quarter.

TransRe’s underwriting results in the fourth quarter of 2013 compared with the fourth quarter of 2012 benefitted from the absence of major catastrophe losses, partially offset by higher commissions, brokerage and other underwriting expenses. The fourth quarter of 2012 included significant catastrophe losses attributable to Super Storm Sandy, but benefitted from the impact of merger-related accounting, which had the effect of reducing commissions, brokerage and other underwriting expenses in the 2012 fourth quarter.

The improvement in the underwriting results of the insurance segment in the fourth quarter of 2013 from the fourth quarter of 2012 primarily reflects the absence of catastrophe losses in the fourth quarter of 2013, which were significant in the fourth quarter of 2012 due to Super Storm Sandy, partially offset by net unfavorable prior year reserve development, primarily from Capitol.

Total net premiums written for the 2013 fourth quarter were $1,001.5 million, compared with $1,023.6 million for the fourth quarter of 2012, a decrease of 2.2%. TransRe’s net premiums written decreased by 8.6% in the 2013 fourth quarter when compared with the 2012 fourth quarter. Net premiums written in the fourth quarter of 2012 included significant reinstatement premiums from Super Storm Sandy. If TransRe’s reinstatement premiums from Super Storm Sandy were excluded, TransRe’s net premiums written would be down 4.6%. Net premiums written in Alleghany’s insurance segment increased by $47.9 million or 23.4% in the 2013 fourth quarter, compared with the fourth quarter of last year. Each of Alleghany’s insurance subsidiaries contributed to this growth. RSUI’s net premiums written increased by 20.3%, Capitol’s net premiums written increased by 27.9% and PacificComp’s net premiums written increased by 75.8% in the 2013 fourth quarter.

Alleghany’s combined ratio for the 2013 fourth quarter was 90.6%, compared with 120.0% for the 2012 fourth quarter. TransRe’s combined ratio for the 2013 fourth quarter was 89.2%, compared with 111.4% for the 2012 fourth quarter, and the insurance segment’s combined ratio for the 2013 fourth quarter was 95.1%, compared with 156.5% for the 2012 fourth quarter.

2013 Full Year Underwriting Results

Alleghany’s underwriting profit for 2013 was $420.7 million, compared with $220.3 million for 2012. The 2013 underwriting results reflect a $334.0 million underwriting profit for TransRe, compared with a $266.7 million underwriting profit for 2012 in the three hundred-day period of Alleghany’s ownership of TransRe. In addition, the 2013 underwriting results reflect an $86.7 million underwriting profit for the insurance segment, compared with a $46.4 million underwriting loss for 2012.

The increase in TransRe’s underwriting profit in 2013 from 2012 primarily reflects lower catastrophe losses and favorable prior accident year reserve development, partially offset by an increase in commissions, brokerage and other underwriting expenses relative to net premiums earned. As explained above, the results for 2013 reflect the absence of the favorable impact arising from the acquisition method of accounting, which was significant in 2012.

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The improvement in underwriting results of the insurance segment in 2013 from 2012 primarily reflects lower catastrophe losses.

Total net premiums written for 2013 were $4,287.4 million, compared with $3,723.9 million for 2012. TransRe’s net premiums written for 2013 increased by 14.3% to $3,248.0 million from 2012, primarily reflecting the fact that 2012 did not include net premiums written by TransRe prior to the merger with Alleghany on March 6, 2012. The insurance segment’s net premiums written for 2013 increased by 17.7% to $1,039.4 million from 2012, primarily due to new business written and modest casualty price increases at RSUI, Capitol and PacificComp. Each of Alleghany’s insurance subsidiaries contributed to this growth. RSUI’s net premiums written were up 15.7%, Capitol’s net premiums written increased by 15.0% and PacificComp’s net premiums written increased by 114.7% in 2013.

Alleghany’s combined ratio for 2013 was 90.1%, compared with 94.1% in 2012. TransRe’s combined ratio for 2013 was 89.9%, compared with 90.9% for 2012, and the insurance segment’s combined ratio for 2013 was 91.0%, compared with 105.7% for 2012. As noted above, TransRe’s combined ratio was favorably impacted as a result of applying the acquisition method of accounting for the merger because deferred acquisition costs were written off at the March 6, 2012 merger date. As of March 6, 2013, the application of the acquisition method of accounting no longer had a significant impact on TransRe’s combined ratio. Excluding the impact of the application of the acquisition method of accounting, TransRe’s estimated combined ratio was approximately 100% for 2012.

Investment Performance

Alleghany’s net investment income for the three months and year ended December 31, 2013 was $131.2 million and $465.7 million, respectively, an increase of 67.3% and 48.8% over the corresponding 2012 periods. The 48.8% increase in 2013 primarily reflects the fact that 2012 did not include net investment income of TransRe prior to the merger with Alleghany on March 6, 2012. Aside from the impact of the merger, the increase in net investment income for the three months and year ended December 31, 2013 reflects higher income from other invested assets, as well as higher interest and dividend income. The interest income earned on TransRe’s fixed income portfolio is net of a significant increase to amortization expense resulting from the write-up of the portfolio’s amortized cost basis to its fair value and the corresponding decrease in interest income accrual rates to reflect market rates as of the date of the merger. This increased amortization expense reduced TransRe’s reported net investment income, compared with TransRe’s net investment income prior to the merger. As the securities which constituted the pre-merger portfolio mature or are sold, the amortization of this expense will decline and TransRe’s fixed income portfolio yield will increasingly reflect market rates since the merger date.

Alleghany’s investment performance also benefitted from the operating results and the sale of Homesite which was completed on December 31, 2013. During 2013, Alleghany recognized $42.9 million in investment income from its percentage of ownership of Homesite’s earnings and recorded a realized gain of $46.8 million upon the completion of its sale.

Additional Information

Additional information regarding Alleghany’s 2013 financial results, including management’s discussion and analysis of Alleghany’s financial condition and results of operations, is contained in Alleghany’s Annual Report on Form 10-K for the period ended December 31, 2013 (the “Form 10-K”), to be filed with the U.S. Securities and Exchange Commission (the “SEC”) on or about the date hereof. In addition, comparative supplemental financial information is available in the 2013 fourth quarter and full year financial supplement (the “Financial Supplement”). The Form 10-K and the Financial Supplement will be available

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on Alleghany’s website at www.alleghany.com and on the SEC’s website at www.sec.gov. Readers are urged to review the Form 10-K for a more complete discussion of Alleghany’s financial performance.

About Alleghany Corporation

Alleghany Corporation (NYSE-Y) creates value through owning and managing operating subsidiaries and investments, anchored by a core position in property and casualty reinsurance and insurance. Alleghany’s property and casualty subsidiaries include: Transatlantic Holdings, Inc. (referred to herein as “TransRe”), a leading global reinsurer; RSUI Group, Inc. (referred to herein as “RSUI”), a national underwriter of property and liability specialty insurance coverages; Capitol Transamerica Corporation (referred to herein as “Capitol”), an underwriter of small commercial property, casualty and surety insurance coverages; and Pacific Compensation Corporation (referred to herein as “PacificComp”), an underwriter of workers’ compensation insurance primarily in California.

Non-GAAP Financial Measures

Throughout this press release, Alleghany’s results of operations have been presented in the way that Alleghany believes will be the most meaningful and useful to investors, analysts, rating agencies and others who use financial information in evaluating the performance of Alleghany. This presentation includes the use of underwriting profit and net earnings before merger-related items and income taxes, which are “non-GAAP financial measures,” as such term is defined in Regulation G promulgated by the SEC.

Underwriting profit represents net premiums earned less net loss and loss adjustment expense and commissions, brokerage and other underwriting expenses, all as determined in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and does not include net investment income, net realized capital gains, other than temporary impairment losses, other income, other operating expenses, amortization of intangible assets or interest expense. Alleghany consistently uses underwriting profit as a supplement to earnings before income taxes, the most comparable U.S. GAAP financial measure, to evaluate the performance of its segments and believes that underwriting profit provides useful additional information to investors because it highlights net earnings attributable to a segment’s underwriting performance. Earnings before income taxes may show a profit despite an underlying underwriting loss, and when underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk.

Net earnings before merger-related items and income taxes represents earnings before income taxes, excluding gain on bargain purchase, amortization of intangible assets and merger-related transaction costs, all as determined in accordance with U.S. GAAP. Alleghany uses net earnings before merger-related items and income taxes as a supplement to earnings before income taxes, the most comparable U.S. GAAP financial measure, to provide useful additional information to investors by highlighting earnings before income taxes attributable to its performance exclusive of non-recurring merger-related impacts.

These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for measures of operating performance prepared in accordance with U.S. GAAP. Reconciliation of underwriting profit to earnings before income taxes and net earnings before merger-related items and income taxes to earnings before income taxes is presented herein.

# # #

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Forward-looking Statements

This release contains disclosures which are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, and can be identified by the use of words such as “may,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “believe,” “potential,” “should,” “continue” or the negative versions of those words or other comparable words. These forward-looking statements are based upon Alleghany’s current plans or expectations and are subject to a number of uncertainties and risks that could significantly affect current plans, anticipated actions and Alleghany’s future financial condition and results. These statements are not guarantees of future performance, and Alleghany has no specific intention to update these statements. The uncertainties and risks include, but are not limited to,

• significant weather-related or other natural or man-made catastrophes and disasters;

• the cyclical nature of the property and casualty reinsurance and insurance industries;

• changes in market prices of Alleghany’s significant equity investments and changes in value of Alleghany’s debt securities portfolio;

• adverse loss development for events insured by Alleghany’s reinsurance and insurance subsidiaries in either the current year or prior years;

• the long-tail and potentially volatile nature of certain casualty lines of business written by Alleghany’s reinsurance and insurance subsidiaries;

• the cost and availability of reinsurance;

• the reliance by Alleghany’s reinsurance operating subsidiaries on a limited number of brokers;

• increases in the levels of risk retention by Alleghany’s reinsurance and insurance subsidiaries;

• exposure to terrorist acts and acts of war;

• the willingness and ability of Alleghany’s reinsurance and insurance subsidiaries’ reinsurers to pay reinsurance recoverables owed to Alleghany’s reinsurance and insurance subsidiaries;

• changes in the ratings assigned to Alleghany’s reinsurance and insurance subsidiaries;

• claims development and the process of estimating reserves;

• legal, political, judicial and regulatory changes, including the federal financial regulatory reform of the insurance industry by the Dodd-Frank Wall Street Reform and Consumer Protection Act;

• the uncertain nature of damage theories and loss amounts;

• the loss of key personnel of Alleghany’s reinsurance or insurance operating subsidiaries;

• fluctuation in foreign currency exchange rates;

• the failure to comply with the restrictive covenants contained in the agreements governing Alleghany’s indebtedness;

• the ability to make payments on, or repay or refinance, Alleghany’s debt;

• risks inherent in international operations; and

• difficult and volatile conditions in the global market.

Additional risks and uncertainties include general economic and political conditions, including the effects of a prolonged U.S. or global economic downturn or recession; changes in costs; variations in political, economic or other factors; risks relating to conducting operations in a competitive environment; effects of acquisition and disposition activities, inflation rates, or recessionary or expansive trends; changes in interest rates; extended labor disruptions, civil unrest, or other external factors over which Alleghany has no control; and changes in Alleghany’s plans, strategies, objectives, expectations, or intentions, which may happen at any time at its discretion. As a consequence, current plans, anticipated actions, and future financial condition and results may differ from those expressed in any forward-looking statements made by Alleghany or on its behalf.

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For more information, please contact:

Jeff Majtyka/Mike Smargiassi

Brainerd Communicators, Inc.

212-986-6667

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ALLEGHANY CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

	December 31,
	2013			2012
	(in thousands, except share amounts)
Assets
Investments:
Available-for-sale securities at fair value:
Equity securities (cost: 2013 – $1,804,698; 2012 – $1,436,540)	$	2,229,453		$	1,424,014
Debt securities (amortized cost: 2013 – $14,875,750; 2012 – $15,593,278)		14,802,890			15,999,538
Short-term investments		1,317,895			366,044
		18,350,238			17,789,596
Other invested assets		641,924			537,350
Total investments		18,992,162			18,326,946
Cash		498,315			649,524
Accrued investment income		146,381			165,857
Premium balances receivable		675,255			585,195
Reinsurance recoverables		1,363,707			1,348,599
Ceded unearned premiums		173,148			154,980
Deferred acquisition costs		334,740			303,515
Property and equipment at cost, net of accumulated depreciation and amortization		58,974			34,118
Goodwill		99,747			83,447
Intangible assets, net of amortization		127,284			128,773
Current taxes receivable		13,049			79,933
Net deferred tax assets		469,787			532,569
Other assets		408,539			414,511
Total assets	$	23,361,088		$	22,807,967
Liabilities and Stockholders’ Equity
Loss and loss adjustment expenses	$	11,952,541		$	12,239,766
Unearned premiums		1,765,550			1,705,342
Senior Notes		1,794,407			1,811,483
Reinsurance payable		90,562			67,654
Other liabilities		810,507			579,935
Total liabilities		16,413,567			16,404,180
Common stock (shares authorized: 2013 and 2012 – 22,000,000; shares issued: 2013 –17,459,961; 2012 – 17,478,746)		17,460			17,479
Contributed capital		3,613,151			3,619,912
Accumulated other comprehensive income		186,930			250,508
Treasury stock, at cost (2013 – 693,769 shares; 2012 – 588,123 shares)		(213,911	)		(175,818	)
Retained earnings		3,320,127			2,691,706
Total stockholders’ equity attributable to Alleghany stockholders		6,923,757			6,403,787
Noncontrolling interest		23,764			—
Total stockholders’ equity		6,947,521			6,403,787
Total liabilities and stockholders’ equity	$	23,361,088		$	22,807,967

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ALLEGHANY CORPORATION AND SUBSIDIARIES

Consolidated Statements of Earnings and Comprehensive Income

	Year Ended December 31,
	2013			2012			2011
	(in thousands, except per share amounts)
Revenues
Net premiums earned	$	4,239,216		$	3,733,005		$	747,639
Net investment income		465,664			312,998			108,910
Net realized capital gains		232,119			157,879			127,141
Other than temporary impairment losses		(44,047	)		(2,907	)		(3,607	)
Gain on bargain purchase		—			494,940			—
Other income		78,702			57,297			1,754
Total revenues		4,971,654			4,753,212			981,837
Costs and Expenses
Net loss and loss adjustment expenses		2,479,353			2,630,170			429,986
Commissions, brokerage and other underwriting expenses		1,339,191			882,502			268,125
Other operating expenses		164,859			123,700			31,101
Corporate administration		36,111			75,842			41,007
Amortization of intangible assets		10,164			253,298			3,355
Interest expense		86,740			68,424			17,426
Total costs and expenses		4,116,418			4,033,936			791,000
Earnings before income taxes		855,236			719,276			190,837
Income taxes		225,882			17,032			47,586
Net earnings		629,354			702,244			143,251
Net earnings attributable to noncontrolling interest		933			—			—
Net earnings attributable to Alleghany stockholders	$	628,421		$	702,244		$	143,251
Net earnings	$	629,354		$	702,244		$	143,251
Other comprehensive income:
Change in unrealized gains, net of deferred taxes of $37,791, $112,301 and $37,139 for 2013, 2012 and 2011, respectively		70,183			208,560			68,973
Less: reclassification for net realized capital gains and other than temporary impairment losses, net of taxes of ($51,209), ($54,240) and ($43,237) for 2013, 2012 and 2011, respectively		(95,102	)		(100,732	)		(80,297	)
Change in unrealized currency translation adjustment, net of deferred taxes of $19,323, $7,200 and $0 for 2013, 2012 and 2011, respectively		(35,886	)		(13,371	)		—
Retirement plans		(2,773	)		520			(3,407	)
Comprehensive income		565,776			797,221			128,520
Comprehensive income attributable to noncontrolling interest		933			—			—
Comprehensive income attributable to Alleghany stockholders	$	564,843		$	797,221		$	128,520
Basic earnings per share attributable to Alleghany stockholders	$	37.44		$	45.48		$	16.26
Diluted earnings per share attributable to Alleghany stockholders		37.44			45.48			16.20

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EX-99.2

Exhibit 99.2

Alleghany

ALLEGHANY CORPORATION AND SUBSIDIARIES

FINANCIAL SUPPLEMENT

Three Months Ended

and

Twelve Months Ended

December 31, 2013

(Unaudited)

Investor Contact:		This report is for informational purposes only. It should be read in conjunction with documents filed by Alleghany Corporation with the U.S. Securities and Exchange Commission, including the company’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q.
Jeff Majtyka/Mike Smargiassi
Brainerd Communicators, Inc.
Phone:	212-986-6667

Definitions

References in this financial supplement for the quarter and year ended December 31, 2013 (the “Financial Supplement”) to the “Company,” “Alleghany,” “we,” “us,” and “our” refer to Alleghany Corporation and its consolidated subsidiaries unless the context otherwise requires. In addition, unless the context otherwise requires, references to

• “TransRe” are to Alleghany’s reinsurance holding company subsidiary Transatlantic Holdings, Inc. and its subsidiaries,

• “AIHL” are to Alleghany’s insurance holding company subsidiary Alleghany Insurance Holdings LLC,

• “RSUI” are to Alleghany’s subsidiary RSUI Group, Inc. and its subsidiaries,

• “Capitol” are to Alleghany’s subsidiary Capitol Transamerica Corporation and its subsidiaries, and also include the operations and results of Platte River Insurance Company, and

• “PCC” are to Alleghany’s subsidiary Pacific Compensation Corporation and its subsidiaries.

Forward-Looking Statements

This Financial Supplement may contain disclosures which are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that do not relate solely to historical or current facts, and can be identified by the use of words such as “may,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “believe,” “potential,” “should,” “continue” or the negative versions of those words or other comparable words. These forward-looking statements are based upon Alleghany’s current plans or expectations and are subject to a number of uncertainties and risks that could significantly affect current plans, anticipated actions and Alleghany’s future financial condition and results. These statements are not guarantees of future performance, and we have no specific intention to update these statements. The uncertainties and risks include, but are not limited to,

• significant weather-related or other natural or man-made catastrophes and disasters;

• the cyclical nature of the property and casualty reinsurance and insurance industries;

• changes in market prices of Alleghany’s significant equity investments and changes in value of Alleghany’s debt securities portfolio;

• adverse loss development for events insured by Alleghany’s reinsurance and insurance subsidiaries in either the current year or prior years;

• the long-tail and potentially volatile nature of certain casualty lines of business written by Alleghany’s reinsurance and insurance subsidiaries;

• the cost and availability of reinsurance;

• the reliance by Alleghany’s reinsurance operating subsidiaries on a limited number of brokers;

• increases in the levels of risk retention by Alleghany’s reinsurance and insurance subsidiaries;

• exposure to terrorist acts and acts of war;

• the willingness and ability of Alleghany’s reinsurance and insurance subsidiaries’ reinsurers to pay reinsurance recoverables owed to Alleghany’s reinsurance and insurance subsidiaries;

• changes in the ratings assigned to Alleghany’s reinsurance and insurance subsidiaries;

• claims development and the process of estimating reserves;

• legal, political, judicial and regulatory changes, including the federal financial regulatory reform of the insurance industry by the Dodd-Frank Wall Street Reform and Consumer Protection Act;

• the uncertain nature of damage theories and loss amounts;

• the loss of key personnel of Alleghany’s reinsurance or insurance operating subsidiaries;

• fluctuation in foreign currency exchange rates;

• the failure to comply with the restrictive covenants contained in the agreements governing Alleghany’s indebtedness;

• the ability to make payments on, or repay or refinance, Alleghany’s debt;

• risks inherent in international operations; and

• difficult and volatile conditions in the global market.

Additional risks and uncertainties include general economic and political conditions, including the effects of a prolonged U.S. or global economic downturn or recession; changes in costs; variations in political, economic or other factors; risks relating to conducting operations in a competitive environment; effects of acquisition and disposition activities, inflation rates, or recessionary or expansive trends; changes in interest rates; extended labor disruptions, civil unrest, or other external factors over which Alleghany has no control; and changes in Alleghany’s plans, strategies, objectives, expectations, or intentions, which may happen at any time at its discretion. As a consequence, current plans, anticipated actions, and future financial condition and results may differ from those expressed in any forward-looking statements made by Alleghany or on its behalf.

PAGE 2

ALLEGHANY CORPORATION AND SUBSIDIARIES

FINANCIAL SUPPLEMENT TABLE OF CONTENTS

		Page
I.	Financial Summary
	10 Year Financial Summary	5
	Consolidated Financial Highlights	6
II.	Consolidated Results
	Consolidated Statements of Earnings - Consecutive Quarters	7
	Consolidated Statements of Earnings - Year to Date	8
	Premiums Written	9
III.	Segment Results
	Consolidated Underwriting Results - Current Quarter	10
	Consolidated Underwriting Results - Prior Year Quarter	11
	Consolidated Underwriting Results - Current Year to Date	12
	Consolidated Underwriting Results - Prior Year to Date	13
IV.	Balance Sheet Details
	Condensed Consolidated Balance Sheets	14
	Consolidated Total Investment Portfolio	15
	Debt Securities Portfolio Credit Quality	16
	Net Investment Income	17
	Financial Statement Portfolio Return	18
	Annualized Investment Book Yield	19
	Loss and Loss Adjustment Expenses (LAE)	20
	Capital Structure and Leverage Ratios	21
V.	Other
	Share Repurchase Detail - Current Year	22
	Basic and Diluted Earnings per Share Information - Consecutive Quarters	23
	Basic and Diluted Earnings per Share Information - Year to Date	24
	Return on Average Stockholders’ Equity - Consecutive Quarters	25
	Return on Average Stockholders’ Equity - Year to Date	26
	Book Value per Share	27
	Catastrophe Exposure	28
	Non-GAAP Financial Measures	29
	Operating Income Reconciliation	30

PAGE 3

ALLEGHANY CORPORATION AND SUBSIDIARIES

BASIS OF PRESENTATION

Presentation

All financial information contained herein is unaudited. Certain amounts may not reconcile exactly due to rounding differences. Unless otherwise noted, all data is in millions of U.S. dollars, except for share, per share, percentage and ratio information.

PAGE 4

ALLEGHANY CORPORATION AND SUBSIDIARIES

10 YEAR FINANCIAL SUMMARY*

(in millions, except per share data)

	As of and for the Year Ended December 31,
	2004			2005			2006			2007			2008			2009			2010			2011			2012			2013
Cash and invested assets	$	2,415.4		$	2,867.6		$	3,699.4		$	4,308.9		$	4,294.3		$	4,447.2		$	4,881.9		$	4,911.6		$	18,976.4		$	19,490.5
Net loss & LAE reserves		639.0			952.9			1,127.5			1,412.9			1,570.3			1,573.3			1,481.3			1,481.2			10,933.9			10,650.4
Preferred stock and debt		80.0			80.0			379.5			299.5			299.4			—			298.9			299.0			1,811.5			1,794.4
Common Stockholders’ Equity (“CSE”) attributable to Alleghany stockholders		1,799.5			1,894.4			2,146.4			2,484.8			2,347.3			2,717.5			2,908.9			2,925.7			6,403.8			6,923.8
Common shares outstanding		8.82			8.90			8.79			8.83			8.78			9.22			8.94			8.55			16.89			16.77
Net invested assets per share	$	264.86		$	313.14		$	377.79		$	453.98		$	455.05		$	482.43		$	512.53		$	539.38		$	1,016.24		$	1,055.46
% increase (decrease)		29.8	%		18.2	%		20.6	%		20.2	%		0.2	%		6.0	%		6.2	%		5.2	%		88.4	%		3.9	%
Book value per common share	$	204.08		$	212.80		$	244.25		$	281.36		$	267.37		$	294.79		$	325.31		$	342.12		$	379.13		$	412.96
% increase (decrease)		12.0	%		4.3	%		14.8	%		15.2	%		(5.0	%)		10.3	%		10.4	%		5.2	%		10.8	%		8.9	%
Net premiums written	$	786.7		$	802.7		$	916.2		$	962.5		$	898.2		$	830.8		$	736.2		$	774.7		$	3,723.9		$	4,287.4
Change in unearned premiums		(27.4	)		16.8			(38.4	)		11.8			50.5			14.2			31.9			(27.1	)		9.1			(48.2	)
Net premiums earned	$	759.3		$	819.5		$	877.8		$	974.3		$	948.7		$	845.0		$	768.1		$	747.6		$	3,733.0		$	4,239.2
Underwriting profit (loss)	$	74.3		$	(117.4	)	$	252.0		$	268.1		$	92.1		$	129.2		$	130.9		$	49.5		$	220.3		$	420.7
Net investment income		62.3			78.1			127.9			146.1			130.2			101.9			125.0			108.9			313.0			465.7
Net realized capital gains, net of OTTI		86.9			148.6			28.2			92.8			(92.2	)		234.5			85.0			123.5			155.0			188.1
Total investment results	$	149.2		$	226.7		$	156.1		$	238.9		$	38.0		$	336.4		$	210.0		$	232.4		$	468.0		$	653.8
Net earnings attributable to Alleghany stockholders		117.7			52.3			238.9			281.8			130.8			264.8			198.5			143.3			702.2			628.4
Other changes in CSE		82.1			42.6			13.2			56.6			(268.4	)		105.5			(7.2	)		(126.5	)		2,775.9			(108.4	)
Increase (decrease) in CSE	$	199.8		$	94.9		$	252.1		$	338.4		$	(137.6	)	$	370.3		$	191.3		$	16.8		$	3,478.1		$	520.0
Combined Ratio		90.2	%		114.3	%		71.3	%		72.5	%		90.3	%		84.7	%		83.0	%		93.4	%		94.1	%		90.1	%

* Amounts have been adjusted for subsequent common stock dividends. The historical results of all subsidiaries that have been sold are reclassified as discontinued operations.

PAGE 5

ALLEGHANY CORPORATION & SUBSIDIARIES

CONSOLIDATED FINANCIAL HIGHLIGHTS

(in millions, except share and per share data)

		As of			As of
		December 31, 2013			December 31, 2012			Change
HIGHLIGHTS	Total investments and cash	$	19,490.5		$	18,976.4			2.7	%
	Total assets		23,361.1			22,808.0			2.4	%
	Total stockholders’ equity attributable to Alleghany stockholders		6,923.8			6,403.8			8.1	%
	Book value per share	$	412.96		$	379.13			8.9	%
		Three Months Ended December 31,
		2013			2012			Change
	Gross premiums written	$	1,134.2		$	1,144.1			(0.9	%)
	Net premiums written		1,001.5			1,023.6			(2.2	%)
	Net premiums earned		1,056.0			1,110.1			(4.9	%)
	Net investment income		131.2			78.4			67.3	%
	Net earnings attributable to Alleghany stockholders		205.3			(92.6	)		(321.7	%)
	Operating income		117.1			(91.4	)		(228.2	%)
PER SHARE AND SHARE DATA	Weighted average common shares outstanding:
	Basic		16,766,192			16,925,994			(0.9	%)
	Diluted		16,766,192			16,925,994			(0.9	%)
	Earnings per share attributable to Alleghany stockholders:
	Basic	$	12.24		$	(5.47	)		(323.8	%)
	Diluted	$	12.24		$	(5.47	)		(323.9	%)
	Operating earnings per share data:
	Basic	$	6.99		$	(5.40	)		(229.4	%)
	Diluted	$	6.99		$	(5.40	)		(229.4	%)
FINANCIAL RATIOS	Annualized return on average stockholders’ equity		12.0	%		–5.7	%
	Loss and loss expense ratio		58.4	%		93.9	%		(35.5	)
	Expense ratio		32.2	%		26.1	%		6.1
	Combined ratio		90.6	%		120.0	%		(29.4	)

PAGE 6

ALLEGHANY CORPORATION & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS - CONSECUTIVE QUARTERS

(in millions, except per share data)

	Three Months Ended
	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Revenues
Net premiums earned	$	1,056.0		$	1,039.9		$	1,068.3		$	1,075.0		$	1,110.1		$	1,092.8		$	1,095.9		$	434.2
Net investment income		131.2			115.3			100.4			118.8			78.4			90.5			90.9			53.2
Net realized investment gains		136.5			17.8			27.0			50.9			38.0			12.4			39.4			68.0
Other than temporary impairment losses		(2.1	)		(0.7	)		(8.9	)		(32.3	)		—			—			(1.1	)		(1.8	)
Gain on bargain purchase		—			—			—			—			—			—			—			494.9
Other income		40.9			17.2			9.4			11.2			13.9			33.8			9.3			0.3
Total revenues		1,362.5			1,189.5			1,196.2			1,223.6			1,240.4			1,229.5			1,234.4			1,048.8
Costs and Expenses
Net loss and loss expenses incurred		616.9			644.5			650.5			567.4			1,042.4			673.0			680.9			233.9
Commissions, brokerage and other underwriting expenses		340.4			333.6			339.0			326.2			289.7			253.8			239.1			99.9
Other operating expenses		67.8			39.0			27.2			30.8			25.8			47.4			34.8			15.7
Corporate administration		10.1			3.7			9.9			12.4			8.1			9.3			11.1			47.3
Amortization of intangible assets		(1.4	)		(0.8	)		0.8			11.6			39.9			73.3			108.1			31.9
Interest expense		21.8			21.5			21.8			21.8			21.8			21.8			15.8			9.1
Total costs and expenses		1,055.6			1,041.5			1,049.2			970.2			1,427.7			1,078.6			1,089.8			437.8
Earnings (losses) before income taxes(1)		306.9			148.0			147.0			253.4			(187.3	)		150.9			144.6			611.0
Income taxes		100.9			34.6			33.3			57.1			(94.7	)		25.5			35.3			50.9
Net earnings (losses)		206.0			113.4			113.7			196.3			(92.6	)		125.4			109.3			560.1
Net earnings attributable to noncontrolling interest		0.7			0.2			—			—			—			—			—			—
Net earnings (losses) attributable to Alleghany stockholders	$	205.3		$	113.2		$	113.7		$	196.3		$	(92.6	)	$	125.4		$	109.3		$	560.1
Basic earnings per share attributable to Alleghany stockholders	$	12.24		$	6.75		$	6.78		$	11.67		$	(5.47	)	$	7.41		$	6.46		$	51.17
Diluted earnings per share attributable to Alleghany stockholders		12.24			6.75			6.78			11.67			(5.47	)		7.41			6.45			51.06
SUPPLEMENTAL INFORMATION:
Premiums written:
Gross premiums written	$	1,134.2		$	1,174.1		$	1,340.5		$	1,237.5		$	1,144.1		$	1,176.4		$	1,369.0		$	533.4
Net premiums written		1,001.5			1,033.4			1,158.5			1,093.9			1,023.6			1,042.5			1,223.7			434.2
Net loss and loss expenses incurred:
Current year		638.6			692.3			713.2			638.3			1,047.9			679.1			666.2			249.3
Prior years		(21.7	)		(47.8	)		(62.7	)		(70.9	)		(5.5	)		(6.1	)		14.7			(15.4	)
	$	616.9		$	644.5		$	650.5		$	567.4		$	1,042.4		$	673.0		$	680.9		$	233.9
Loss and loss expense ratio		58.4	%		62.0	%		60.9	%		52.8	%		93.9	%		61.6	%		62.1	%		53.9	%
Expense ratio		32.2	%		32.1	%		31.7	%		30.3	%		26.1	%		23.2	%		21.8	%		23.0	%
Combined ratio		90.6	%		94.1	%		92.6	%		83.1	%		120.0	%		84.8	%		83.9	%		76.9	%

(1) Merger-related items associated with the merger with TransRe include a gain on bargain purchase, amortization of intangible assets, and transaction costs. Pre-tax earnings for the 2013 fourth quarter, before merger-related items, were $305.5 million, compared with pre-tax losses, before merger-related items, of $147.4 million for the 2012 fourth quarter. Refer to our earnings release for the 2013 fourth quarter issued on February 25, 2014 (the “Earnings Release”) for further detail.

PAGE 7

ALLEGHANY CORPORATION & SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EARNINGS - YEAR TO DATE

(in millions, except per share data)

	Twelve Months Ended
	December 31, 2013			December 31, 2012
Revenues
Net premiums earned	$	4,239.2		$	3,733.0
Net investment income		465.7			313.0
Net realized investment gains		232.1			157.9
Other than temporary impairment losses		(44.0	)		(2.9	)
Gain on bargain purchase		—			494.9
Other income		78.7			57.3
Total revenues		4,971.7			4,753.2
Costs and Expenses
Net loss and loss expenses incurred		2,479.3			2,630.3
Commissions, brokerage and other underwriting expenses		1,339.2			882.4
Other operating expenses		164.9			123.7
Corporate administration		36.1			75.8
Amortization of intangible assets		10.2			253.3
Interest expense		86.8			68.4
Total costs and expenses		4,116.5			4,033.9
Earnings before income taxes(1)		855.2			719.3
Income taxes		225.9			17.1
Net earnings		629.3			702.2
Net earnings attributable to noncontrolling interest		0.9			—
Net earnings (losses) attributable to Alleghany stockholders	$	628.4		$	702.2
Basic earnings per share attributable to Alleghany stockholders	$	37.44		$	45.48
Diluted earnings per share attributable to Alleghany stockholders		37.44			45.48
SUPPLEMENTAL INFORMATION:
Premiums written:
Gross premiums written	$	4,886.3		$	4,222.9
Net premiums written		4,287.4			3,723.9
Net loss and loss expenses incurred:
Current year		2,682.3			2,642.6
Prior years		(203.0	)		(12.3	)
	$	2,479.3		$	2,630.3
Loss and loss expense ratio		58.5	%		70.5	%
Expense ratio		31.6	%		23.6	%
Combined ratio		90.1	%		94.1	%

(1) Merger-related items associated with the merger with TransRe include a gain on bargain purchase, amortization of intangible assets and transaction costs. Pre-tax earnings for full year 2013, before merger-related items, were $865.4 million, compared with pre-tax earnings, before merger-related items, of $511.5 million for the full year 2012. Refer to our Earnings Release for further detail.

PAGE 8

ALLEGHANY CORPORATION AND SUBSIDIARIES

PREMIUMS WRITTEN

(in millions)

	For the Three Months Ended December 31, 2013
	Gross Premiums Written												Net Premiums Written
	2013			2012			Change			% Change			2013		2012		Change			% Change
Reinsurance segment:
Property	$	256.6		$	305.4		$	(48.8	)		–16.0	%	$	232.1	$	288.3	$	(56.2	)		–19.5	%
Casualty and Other		523.5			537.9			(14.4	)		–2.7	%		516.5		530.3		(13.8	)		–2.6	%
		780.1			843.3			(63.2	)		–7.5	%		748.6		818.6		(70.0	)		–8.6	%
Insurance segment:
RSUI		299.5			262.0			37.5			14.3	%		196.4		163.3		33.1			20.3	%
Capitol		48.2			37.3			10.9			29.2	%		44.9		35.1		9.8			27.9	%
PCC		12.0			6.8			5.2			76.5	%		11.6		6.6		5.0			75.8	%
		359.7			306.1			53.6			17.5	%		252.9		205.0		47.9			23.4	%
Intercompany elimination		(5.6	)		(5.3	)		(0.3	)		5.7	%		—		—		—
Total	$	1,134.2		$	1,144.1		$	(9.9	)		–0.9	%	$	1,001.5	$	1,023.6	$	(22.1	)		–2.2	%
	For the Twelve Months Ended December 31, 2013
	Gross Premiums Written												Net Premiums Written
	2013			2012			Change			% Change			2013		2012		Change			% Change
Reinsurance segment:
Property	$	1,129.9		$	966.2		$	163.7			16.9	%	$	988.4	$	896.9	$	91.5			10.2	%
Casualty and Other		2,293.1			1,974.0			319.1			16.2	%		2,259.6		1,943.8		315.8			16.2	%
		3,423.0			2,940.2			482.8			16.4	%		3,248.0		2,840.7		407.3			14.3	%
Insurance segment:
RSUI		1,261.6			1,123.4			138.2			12.3	%		827.2		715.1		112.1			15.7	%
Capitol		182.8			158.1			24.7			15.6	%		171.4		149.1		22.3			15.0	%
PCC		42.0			19.4			22.6			116.5	%		40.8		19.0		21.8			114.7	%
		1,486.4			1,300.9			185.5			14.3	%		1,039.4		883.2		156.2			17.7	%
Intercompany elimination		(23.1	)		(18.2	)		(4.9	)		26.9	%		—		—		—
Total	$	4,886.3		$	4,222.9		$	663.4			15.7	%	$	4,287.4	$	3,723.9	$	563.5			15.1	%

PAGE 9

ALLEGHANY CORPORATION AND SUBSIDIARIES

CONSOLIDATED UNDERWRITING RESULTS - CURRENT QUARTER

For the Three Months Ended December 31, 2013

(dollars in millions)

	Reinsurance Segment									Insurance Segment
				Casualty &																		Total			Corporate
	Property			Other			Total			RSUI			Capitol			PCC			Total			Segments			Activities			Consolidated
Premiums written:
Gross	$	256.6		$	523.5		$	780.1		$	299.5		$	48.2		$	12.0		$	359.7		$	1,139.8		$	(5.6	)	$	1,134.2
Net		232.1			516.5			748.6			196.4			44.9			11.6			252.9			1,001.5			—			1,001.5
Net premiums earned	$	241.1		$	556.2		$	797.3		$	203.7		$	43.2		$	11.8		$	258.7		$	1,056.0		$	—		$	1,056.0
Net loss and LAE:
Current year		136.5			364.1			500.6			105.3			23.4			9.3			138.0			638.6			—			638.6
Prior years		(52.4	)		4.9			(47.5	)		(3.3	)		23.9			5.2			25.8			(21.7	)		—			(21.7	)
		84.1			369.0			453.1			102.0			47.3			14.5			163.8			616.9			—			616.9
Commissions, brokerage and other underwriting expenses		72.6			185.5			258.1			53.8			23.2			5.3			82.3			340.4			—			340.4
Underwriting profit (loss)	$	84.4		$	1.7		$	86.1		$	47.9		$	(27.3	)	$	(8.0	)	$	12.6			98.7			—			98.7
Net investment income																							119.8			11.4			131.2
Net realized capital gains																							88.2			48.3			136.5
OTTI losses																							(2.1	)		—			(2.1	)
Gain on bargain purchase																							—			—			—
Other income																							(2.0	)		42.9			40.9
Other operating expenses																							26.9			40.9			67.8
Corporate administration																							—			10.1			10.1
Amortization of intangible assets																							(1.5	)		0.1			(1.4	)
Interest expense																							12.3			9.5			21.8
Earnings before income taxes																						$	264.9		$	42.0		$	306.9
Ratios:
Net loss and LAE
Current year		56.6	%		65.5	%		62.8	%		51.7	%		54.0	%		79.3	%		53.3	%		60.5	%
Prior years		–21.7	%		0.8	%		–6.0	%		–1.6	%		55.3	%		44.1	%		10.0	%		–2.1	%
		34.9	%		66.3	%		56.8	%		50.1	%		109.3	%		123.4	%		63.3	%		58.4	%
Expense		30.1	%		33.4	%		32.4	%		26.4	%		53.8	%		44.8	%		31.8	%		32.2	%
Combined		65.0	%		99.7	%		89.2	%		76.5	%		163.1	%		168.2	%		95.1	%		90.6	%

PAGE 10

ALLEGHANY CORPORATION AND SUBSIDIARIES

CONSOLIDATED UNDERWRITING RESULTS - PRIOR YEAR QUARTER

For the Three Months Ended December 31, 2012

(dollars in millions)

	Reinsurance Segment									Insurance Segment
				Casualty &																		Total			Corporate
	Property			Other			Total			RSUI			Capitol			PCC			Total			Segments			Activities			Consolidated
Premiums written:
Gross	$	305.4		$	537.9		$	843.3		$	262.0		$	37.3		$	6.8		$	306.1		$	1,149.4		$	(5.3	)	$	1,144.1
Net		288.3			530.3			818.6			163.3			35.1			6.6			205.0			1,023.6			—			1,023.6
Net premiums earned	$	297.4		$	601.1		$	898.5		$	168.2		$	37.2		$	6.2		$	211.6		$	1,110.1		$	—		$	1,110.1
Net loss and LAE:
Current year		350.9			436.2			787.1			234.7			19.7			6.4			260.8			1,047.9			—			1,047.9
Prior years		—			—			—			(8.3	)		(0.9	)		3.7			(5.5	)		(5.5	)		—			(5.5	)
		350.9			436.2			787.1			226.4			18.8			10.1			255.3			1,042.4			—			1,042.4
Commissions, brokerage and other underwriting expenses		70.0			143.8			213.8			47.7			20.7			7.5			75.9			289.7			—			289.7
Underwriting profit (loss)	$	(123.5	)	$	21.1		$	(102.4	)	$	(105.9	)	$	(2.3	)	$	(11.4	)	$	(119.6	)		(222.0	)		—			(222.0	)
Net investment income																							91.4			(13.0	)		78.4
Net realized capital gains																							36.7			1.3			38.0
OTTI losses																							—			—			—
Gain on bargain purchase																							—			—			—
Other income																							0.9			13.0			13.9
Other operating expenses																							15.3			10.5			25.8
Corporate administration																							—			8.1			8.1
Amortization of intangible assets																							39.9			—			39.9
Interest expense																							12.4			9.4			21.8
Earnings before income taxes																						$	(160.6	)	$	(26.7	)	$	(187.3	)
Ratios:
Net loss and LAE
Current year		118.0	%		72.6	%		87.6	%		139.5	%		53.0	%		102.0	%		123.2	%		94.4	%
Prior years		0.0	%		0.0	%		0.0	%		–4.9	%		–2.5	%		59.7	%		–2.6	%		–0.5	%
		118.0	%		72.6	%		87.6	%		134.6	%		50.5	%		161.7	%		120.6	%		93.9	%
Expense		23.5	%		23.9	%		23.8	%		28.3	%		55.5	%		121.3	%		35.9	%		26.1	%
Combined		141.5	%		96.5	%		111.4	%		162.9	%		106.0	%		283.0	%		156.5	%		120.0	%

PAGE 11

ALLEGHANY CORPORATION AND SUBSIDIARIES

CONSOLIDATED UNDERWRITING RESULTS - CURRENT YEAR TO DATE

For the Twelve Months Ended December 31, 2013

(dollars in millions)

	Reinsurance Segment									Insurance Segment
				Casualty &																		Total			Corporate
	Property			Other			Total			RSUI			Capitol			PCC			Total			Segments			Activities			Consolidated
Premiums written:
Gross	$	1,129.9		$	2,293.1		$	3,423.0		$	1,261.6		$	182.8		$	42.0		$	1,486.4		$	4,909.4		$	(23.1	)	$	4,886.3
Net		988.4			2,259.6			3,248.0			827.2			171.4			40.8			1,039.4			4,287.4			—			4,287.4
Net premiums earned	$	989.2		$	2,289.5		$	3,278.7		$	764.0		$	157.6		$	38.9		$	960.5		$	4,239.2		$	—		$	4,239.2
Net loss and LAE:
Current year		501.2			1,649.3			2,150.5			422.1			78.7			31.0			531.8			2,682.3			—			2,682.3
Prior years		(184.7	)		(39.4	)		(224.1	)		(17.9	)		25.8			13.2			21.1			(203.0	)		—			(203.0	)
		316.5			1,609.9			1,926.4			404.2			104.5			44.2			552.9			2,479.3			—			2,479.3
Commissions, brokerage and other underwriting expenses		293.3			725.0			1,018.3			208.9			84.1			27.9			320.9			1,339.2			—			1,339.2
Underwriting profit (loss)	$	379.4		$	(45.4	)	$	334.0		$	150.9		$	(31.0	)	$	(33.2	)	$	86.7			420.7			—			420.7
Net investment income																							415.2			50.5			465.7
Net realized capital gains																							197.7			34.4			232.1
OTTI losses																							(44.0	)		—			(44.0	)
Gain on bargain purchase																							—			—			—
Other income																							1.8			76.9			78.7
Other operating expenses																							83.7			81.2			164.9
Corporate administration																							—			36.1			36.1
Amortization of intangible assets																							10.0			0.2			10.2
Interest expense																							49.4			37.4			86.8
Earnings before income taxes																						$	848.3		$	6.9		$	855.2
Ratios:
Net loss and LAE
Current year		50.7	%		72.0	%		65.6	%		55.2	%		49.9	%		79.7	%		55.4	%		63.3	%
Prior years		–18.7	%		–1.7	%		–6.8	%		–2.3	%		16.4	%		33.9	%		2.2	%		–4.8	%
		32.0	%		70.3	%		58.8	%		52.9	%		66.3	%		113.6	%		57.6	%		58.5	%
Expense		29.7	%		31.7	%		31.1	%		27.3	%		53.4	%		71.7	%		33.4	%		31.6	%
Combined		61.7	%		102.0	%		89.9	%		80.2	%		119.7	%		185.3	%		91.0	%		90.1	%

PAGE 12

ALLEGHANY CORPORATION AND SUBSIDIARIES

CONSOLIDATED UNDERWRITING RESULTS - PRIOR YEAR TO DATE

For the Twelve Months Ended December 31, 2012

(dollars in millions)

	Reinsurance Segment									Insurance Segment
				Casualty &																		Total			Corporate
	Property			Other			Total			RSUI			Capitol			PCC			Total			Segments			Activities			Consolidated
Premiums written:
Gross	$	966.2		$	1,974.0		$	2,940.2		$	1,123.4		$	158.1		$	19.4		$	1,300.9		$	4,241.1		$	(18.2	)	$	4,222.9
Net		896.9			1,943.8			2,840.7			715.1			149.1			19.0			883.2			3,723.9			—			3,723.9
Net premiums earned	$	900.9		$	2,015.0		$	2,915.9		$	655.8		$	144.6		$	16.7		$	817.1		$	3,733.0		$	—		$	3,733.0
Net loss and LAE:
Current year		566.4			1,491.7			2,058.1			497.3			72.7			14.5			584.5			2,642.6			—			2,642.6
Prior years		—			—			—			(31.1	)		13.2			5.6			(12.3	)		(12.3	)		—			(12.3	)
		566.4			1,491.7			2,058.1			466.2			85.9			20.1			572.2			2,630.3			—			2,630.3
Commissions, brokerage and other underwriting expenses		191.1			400.0			591.1			184.3			79.2			27.8			291.3			882.4			—			882.4
Underwriting profit (loss)	$	143.4		$	123.3		$	266.7		$	5.3		$	(20.5	)	$	(31.2	)	$	(46.4	)		220.3			—			220.3
Net investment income																							317.5			(4.5	)		313.0
Net realized capital gains																							117.9			40.0			157.9
OTTI losses																							(2.9	)		—			(2.9	)
Gain on bargain purchase																							—			494.9			494.9
Other income																							26.1			31.2			57.3
Other operating expenses																							89.2			34.5			123.7
Corporate administration																							—			75.8			75.8
Amortization of intangible assets																							253.3			—			253.3
Interest expense																							40.8			27.6			68.4
Earnings before income taxes																						$	295.6		$	423.7		$	719.3
Ratios:
Net loss and LAE
Current year		62.9	%		74.0	%		70.6	%		75.8	%		50.2	%		86.8	%		71.5	%		70.8	%
Prior years		0.0	%		0.0	%		0.0	%		–4.7	%		9.1	%		33.2	%		–1.5	%		–0.3	%
		62.9	%		74.0	%		70.6	%		71.1	%		59.4	%		120.0	%		70.0	%		70.5	%
Expense		21.2	%		19.9	%		20.3	%		28.1	%		54.8	%		166.5	%		35.7	%		23.6	%
Combined		84.1	%		93.9	%		90.9	%		99.2	%		114.2	%		286.5	%		105.7	%		94.1	%

PAGE 13

ALLEGHANY CORPORATION & SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

	December 31, 2013		December 31, 2012
	(in thousands)
Assets
Investments:
Available-for-sale securities at fair value:
Equity securities	$	2,229,453	$	1,424,014
Debt securities		14,802,890		15,999,538
Short-term investments		1,317,895		366,044
		18,350,238		17,789,596
Other invested assets		641,924		537,350
Total investments		18,992,162		18,326,946
Cash		498,315		649,524
Reinsurance recoverables		1,363,707		1,348,599
Goodwill and intangible assets		227,031		212,220
All other assets		2,279,873		2,270,678
Total assets	$	23,361,088	$	22,807,967
Liabilities and Stockholders’ Equity
Loss and loss adjustment expenses	$	11,952,541	$	12,239,766
Unearned premiums		1,765,550		1,705,342
Senior Notes		1,794,407		1,811,483
All other liabilities		901,069		647,589
Total liabilities		16,413,567		16,404,180
Total stockholders’ equity attributable to Alleghany stockholders		6,923,757		6,403,787
Noncontrolling interest		23,764		—
Total stockholders’ equity		6,947,521		6,403,787
Total liabilities and stockholders’ equity	$	23,361,088	$	22,807,967

PAGE 14

ALLEGHANY CORPORATION AND SUBSIDIARIES

CONSOLIDATED TOTAL INVESTMENT PORTFOLIO

(dollars in millions)

	December 31, 2013				September 30, 2013				June 30, 2013				March 31, 2013				December 31, 2012				September 30, 2012				June 30, 2012				March 31, 2012
CARRYING VALUE
Equity securities	$	2,229.4	11.7	%	$	2,035.2	10.8	%	$	1,827.5	10.0	%	$	2,004.9	10.8	%	$	1,424.0	7.8	%	$	1,504.6	8.2	%	$	1,047.1	5.8	%	$	773.9	4.4	%
Debt securities		14,802.9	77.9	%		15,041.1	80.0	%		14,944.1	81.7	%		15,110.5	81.6	%		15,999.5	87.3	%		16,336.5	88.5	%		15,596.8	86.2	%		15,733.9	89.8	%
Short term investments		1,317.9	6.9	%		949.3	5.1	%		884.4	4.8	%		757.1	4.1	%		366.0	2.0	%		235.1	1.2	%		1,023.1	5.6	%		571.7	3.3	%
Other invested assets		641.9	3.5	%		771.7	4.1	%		645.9	3.5	%		643.1	3.5	%		537.4	2.9	%		383.7	2.1	%		433.9	2.4	%		434.9	2.5	%
Total	$	18,992.1	100.0	%	$	18,797.3	100.0	%	$	18,301.9	100.0	%	$	18,515.6	100.0	%	$	18,326.9	100.0	%	$	18,459.9	100.0	%	$	18,100.9	100.0	%	$	17,514.4	100.0	%
INVESTMENT ALLOCATION BY CARRYING VALUE
Equity securities:
Common stock	$	2,229.4	11.7	%	$	2,035.2	10.8	%	$	1,827.5	10.0	%	$	2,004.9	10.8	%	$	1,424.0	7.8	%	$	1,504.6	8.2	%	$	1,047.1	5.8	%	$	773.9	4.4	%
Preferred stock		—	0.0	%		—	0.0	%		—	0.0	%		—	0.0	%		—	0.0	%		—	0.0	%		—	0.0	%		—	0.0	%
		2,229.4	11.7	%		2,035.2	10.8	%		1,827.5	10.0	%		2,004.9	10.8	%		1,424.0	7.8	%		1,504.6	8.2	%		1,047.1	5.8	%		773.9	4.4	%
Debt securities:
U.S. government obligations		955.0	5.0	%		1,000.5	5.3	%		441.9	2.4	%		522.1	2.8	%		522.9	2.9	%		486.2	2.6	%		528.6	2.9	%		545.8	3.1	%
Municipal bonds		5,590.1	29.4	%		5,974.9	31.8	%		6,364.2	34.8	%		6,321.8	34.1	%		6,304.1	34.4	%		6,563.9	35.6	%		6,602.3	36.5	%		6,774.2	38.7	%
Foreign government obligations		975.4	5.1	%		1,062.8	5.7	%		836.6	4.6	%		821.1	4.4	%		816.0	4.5	%		838.4	4.5	%		824.2	4.6	%		869.7	5.0	%
U.S. corporate bonds		2,312.9	12.2	%		2,173.5	11.6	%		2,691.1	14.7	%		2,842.5	15.4	%		3,515.7	19.2	%		3,516.8	19.1	%		3,040.9	16.8	%		2,944.5	16.8	%
Foreign corporate bonds		1,831.7	9.6	%		1,777.3	9.5	%		1,886.2	10.3	%		1,950.1	10.6	%		2,198.5	12.0	%		2,203.7	11.9	%		1,944.9	10.7	%		2,076.6	11.9	%
Mortgage and asset-backed securities:
Residential mortgage-backed securities (“RMBS”)		1,547.8	8.1	%		1,591.7	8.5	%		1,458.7	8.0	%		1,611.2	8.7	%		1,662.5	9.1	%		1,975.9	10.7	%		1,978.7	10.9	%		1,823.7	10.4	%
Commercial mortgage-backed securities (“CMBS”)		885.6	4.7	%		858.5	4.6	%		829.8	4.5	%		627.6	3.3	%		510.1	2.8	%		493.9	2.7	%		427.8	2.4	%		394.1	2.3	%
Asset-backed securities		704.4	3.7	%		601.9	3.2	%		435.6	2.4	%		414.1	2.1	%		469.7	2.6	%		257.7	1.4	%		249.4	1.4	%		305.3	1.7	%
		14,802.9	77.9	%		15,041.1	80.0	%		14,944.1	81.7	%		15,110.5	81.6	%		15,999.5	87.3	%		16,336.5	88.5	%		15,596.8	86.2	%		15,733.9	89.8	%
Short term investments		1,317.9	6.9	%		949.3	5.1	%		884.4	4.8	%		757.1	4.1	%		366.0	2.0	%		235.1	1.2	%		1,023.1	5.6	%		571.7	3.3	%
Other invested assets:
Equity method investments		87.4	0.6	%		219.1	1.2	%		218.2	1.2	%		213.6	1.2	%		191.9	1.0	%		195.7	1.1	%		196.6	1.1	%		201.1	1.1	%
Partnership investments		282.4	1.5	%		268.7	1.4	%		288.6	1.6	%		291.4	1.6	%		311.9	1.7	%		155.5	0.8	%		206.7	1.1	%		205.8	1.2	%
Other		272.1	1.4	%		283.9	1.5	%		139.1	0.8	%		138.1	0.7	%		33.6	0.2	%		32.5	0.2	%		30.6	0.2	%		28.0	0.2	%
		641.9	3.5	%		771.7	4.1	%		645.9	3.5	%		643.1	3.5	%		537.4	2.9	%		383.7	2.1	%		433.9	2.4	%		434.9	2.5	%
Total	$	18,992.1	100.0	%	$	18,797.3	100.0	%	$	18,301.9	100.0	%	$	18,515.6	100.0	%	$	18,326.9	100.0	%	$	18,459.9	100.0	%	$	18,100.9	100.0	%	$	17,514.4	100.0	%
RATINGS* OF DEBT SECURIIES PORTFOLIO, BY CARRYING VALUE
AAA/Aaa	$	2,559.2	17.3	%	$	2,613.7	17.4	%	$	2,431.4	16.3	%	$	2,359.5	15.6	%	$	2,636.4	16.5	%	$	2,551.1	15.6	%	$	2,442.5	15.7	%	$	2,526.5	16.1	%
AA/Aa		7,295.9	49.3	%		7,801.9	51.9	%		7,327.7	49.0	%		7,542.2	49.9	%		7,606.0	47.5	%		8,077.3	49.4	%		7,942.4	50.9	%		8,123.3	51.6	%
A/A		2,984.0	20.2	%		3,247.8	21.6	%		3,508.5	23.5	%		3,660.2	24.2	%		4,031.8	25.2	%		4,042.2	24.7	%		3,948.4	25.3	%		4,044.9	25.7	%
BBB/Baa		1,633.9	11.0	%		1,253.0	8.3	%		1,387.0	9.3	%		1,285.2	8.5	%		1,456.7	9.1	%		1,430.4	8.8	%		1,108.7	7.1	%		892.5	5.7	%
BB / Ba		56.9	0.4	%		24.3	0.2	%		55.1	0.4	%		62.0	0.4	%		59.7	0.4	%		68.3	0.4	%		33.5	0.2	%		15.3	0.1	%
B		132.5	0.9	%		16.3	0.1	%		81.6	0.5	%		52.8	0.3	%		55.2	0.3	%		42.4	0.3	%		4.8	0.0	%		5.1	0.0	%
CCC		79.5	0.5	%		46.3	0.3	%		47.9	0.3	%		49.4	0.4	%		45.8	0.3	%		43.5	0.3	%		40.6	0.3	%		40.4	0.3	%
CC		26.7	0.2	%		26.7	0.2	%		27.1	0.2	%		28.3	0.2	%		27.9	0.2	%		19.3	0.1	%		17.7	0.1	%		19.4	0.1	%
Below CC		5.0	0.0	%		4.8	0.0	%		5.1	0.0	%		5.4	0.0	%		5.3	0.0	%		15.0	0.1	%		13.3	0.1	%		13.8	0.1	%
Not rated		29.3	0.2	%		6.3	0.0	%		72.7	0.5	%		65.5	0.5	%		74.7	0.5	%		47.0	0.3	%		44.9	0.3	%		52.7	0.3	%
	$	14,802.9	100.0	%	$	15,041.1	100.0	%	$	14,944.1	100.0	%	$	15,110.5	100.0	%	$	15,999.5	100.0	%	$	16,336.5	100.0	%	$	15,596.8	100.0	%	$	15,733.9	100.0	%
Duration of debt securities portfolio		4.5 years				4.3 years				4.2 years				3.8 years				3.7 years				3.7 years				3.7 years				4.0 years
Average credit quality**		AA-				AA-				AA-				AA-				AA-				AA-				AA-				AA-

* The debt securities portfolio credit quality is measured using the lower of the Standard & Poor’s Ratings Services, Moody’s Investors Services Inc. or Fitch’s Ratings rating.

** The average debt securities portfolio credit quality is measured by weighting each individual securuity’s rating, which uses the lower of the Standard & Poor’s Ratings Services, Moody’s Investors Services Inc. or Fitch’s Ratings rating.

PAGE 15

ALLEGHANY CORPORATION & SUBSIDIARIES

DEBT SECURITIES PORTFOLIO CREDIT QUALITY*

December 31, 2013

(in millions)

	AAA / Aaa			AA / Aa			A			BBB / Baa			Below BBB / Baa or Not-Rated			Total Carrying Value
U.S. Government obligations	$	—		$	955.0		$	—		$	—		$	—		$	955.0
Municipal bonds		818.1			3,694.0			1,001.3			76.7			—			5,590.1
Foreign government obligations		451.5			316.9			204.2			—			2.8			975.4
U.S. corporate bonds		18.0			220.4			729.2			1,157.8			187.5			2,312.9
Foreign corporate bonds		258.0			492.3			802.2			243.8			35.4			1,831.7
Mortgage and asset-backed securities:
RMBS		32.6			1,386.0			39.2			7.1			82.9			1,547.8
CMBS		415.9			222.0			152.2			82.8			12.7			885.6
Other asset-backed securities		565.1			9.3			55.7			65.7			8.6			704.4
Total debt securities	$	2,559.2		$	7,295.9		$	2,984.0		$	1,633.9		$	329.9		$	14,802.9
Percentage of debt securities		17.3	%		49.3	%		20.2	%		11.0	%		2.2	%		100.0	%

* The debt securities portfolio credit quality is measured using the lowest of the Standard & Poor’s Ratings Services, Moody’s Investors Services Inc. or Fitch’s Ratings rating.

PAGE 16

ALLEGHANY CORPORATION AND SUBSIDIARIES

NET INVESTMENT INCOME

(in millions)

	Three Months Ended
	December 31,
	2013			2012
Interest income	$	90.3		$	87.9
Dividends		18.5			10.4
Investment in Ares Management LLC		6.2			—
Equity in results of Pillar Capital Holdings Limited and related funds		13.5			—
Equity in results of Homesite Group Incorporated		10.7			(16.4	)
Equity in results of ORX Exploration, Inc.		0.9			(0.3	)
Other investment results		(4.2	)		2.1
Total investment income		135.9			83.7
Investment expenses		(4.7	)		(5.3	)
Net investment income	$	131.2		$	78.4
Net investment income - after tax*	$	103.4		$	70.8
	Twelve Months Ended
	December 31,
	2013			2012
Interest income	$	348.0		$	306.1
Dividends		59.6			24.9
Investment in Ares Management LLC		9.1			—
Equity in results of Pillar Capital Holdings Limited and related funds		27.2			—
Equity in results of Homesite Group Incorporated		42.9			(6.9	)
Equity in results of ORX Exploration, Inc.		(1.0	)		(4.5	)
Other investment results		0.2			10.2
Total investment income		486.0			329.8
Investment expenses		(20.3	)		(16.8	)
Net investment income	$	465.7		$	313.0
Net investment income - after tax*	$	379.4		$	271.1

* Reflects income tax at a 35.0 percent statutory rate, except for tax-exempt interest income and dividends subject to dividend-received deductions.

PAGE 17

ALLEGHANY CORPORATION AND SUBSIDIARIES

FINANCIAL STATEMENT PORTFOLIO RETURN

(dollars in millions)

	Three Months Ended
	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Investment income and realized gains*:
Net investment income	$	131.2		$	115.3		$	100.4		$	118.8		$	78.4		$	90.5		$	90.9		$	53.2
Net realized investment gains		136.5			17.8			27.0			50.9			38.0			12.4			39.5			68.0
Other than temporary impairment losses		(2.1	)		(0.7	)		(8.9	)		(32.3	)		—			—			(1.1	)		(1.8	)
		265.6			132.4			118.5			137.4			116.4			102.9			129.3			119.4
Opening net unrealized gains on investment securities*:
Net unrealized gains on debt securities portfolio	$	23.0		$	1.6		$	354.7		$	406.2		$	427.6		$	224.6		$	108.9		$	140.6
Net unrealized gains on equity securities portfolio		292.2			166.0			152.3			(12.5	)		46.8			0.8			114.7			95.3
		315.2			167.6			507.0			393.7			474.4			225.4			223.6			235.9
Closing net unrealized gains on investment securities*:
Net unrealized gains on debt securities portfolio	$	(72.9	)	$	23.0		$	1.6		$	354.7		$	406.2		$	427.6		$	224.6		$	108.9
Net unrealized gains on equity securities portfolio		424.8			292.2			166.0			152.3			(12.5	)		46.8			0.8			114.7
		351.9			315.2			167.6			507.0			393.7			474.4			225.4			223.6
Increase (decrease) in net unrealized gains on investment securities*:
Increase (decrease) on debt securities portfolio	$	(95.9	)	$	21.4		$	(353.1	)	$	(51.5	)	$	(21.4	)	$	203.0		$	115.7		$	(31.7	)
Increase (decrease) on equity securities portfolio		132.6			126.2			13.7			164.8			(59.3	)		46.0			(113.9	)		19.4
		36.7			147.6			(339.4	)		113.3			(80.7	)		249.0			1.8			(12.3	)
Net investment income, realized gains and unrealized gains*	$	302.3		$	280.0		$	(220.9	)	$	250.7		$	35.7		$	351.9		$	131.1		$	107.1
Opening aggregate invested assets, at fair value	$	18,797.3		$	18,301.9		$	18,515.6		$	18,326.9		$	18,459.9		$	18,100.9		$	17,514.4		$	4,826.8
Closing aggregate invested assets, at fair value		18,992.1			18,797.3			18,301.9			18,515.6			18,326.9			18,459.9			18,100.9			17,514.4
Average invested assets	$	18,894.7		$	18,549.6		$	18,408.8		$	18,421.3		$	18,393.4		$	18,280.4		$	17,807.7		$	11,170.6
Financial statement portfolio return		1.6	%		1.5	%		–1.2	%		1.4	%		0.2	%		1.9	%		0.7	%		1.0	%
		Twelve Months Ended December 31, 2013												Twelve Months Ended December 31, 2012
Investment income and realized gains*:
Net investment income	$	465.7											$	313.0
Net realized investment gains		232.1												157.9
Other than temporary impairment losses		(44.0	)											(2.9	)
		653.8												468.0
Opening net unrealized gains on investment securities*:
Net unrealized gains on debt securities portfolio	$	406.2											$	140.6
Net unrealized gains on equity securities portfolio		(12.5	)											95.3
		393.7												235.9
Closing net unrealized gains on investment securities*:
Net unrealized gains on debt securities portfolio	$	(72.9	)										$	406.2
Net unrealized gains on equity securities portfolio		424.8												(12.5	)
		351.9												393.7
Increase (decrease) in net unrealized gains on investment securities*:
Increase (decrease) on debt securities portfolio	$	(479.1	)										$	265.6
Increase (decrease) on equity securities portfolio		437.3												(107.8	)
		(41.8	)											157.8
Net investment income, realized gains and unrealized gains*	$	612.0											$	625.8
Opening aggregate invested assets, at fair value	$	18,326.9											$	4,826.8
Closing aggregate invested assets, at fair value		18,992.1												18,326.9
Average invested assets	$	18,659.5											$	11,576.9
Financial statement portfolio return		3.3	%											5.4	%

* Before income tax.

PAGE 18

ALLEGHANY CORPORATION AND SUBSIDIARIES

ANNUALIZED INVESTMENT BOOK YIELD

(dollars in millions)

	Three Months Ended
	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Net investment income	$	131.2		$	115.3		$	100.4		$	118.8		$	78.4		$	90.5		$	90.9		$	53.2
Opening invested assets:
Debt securities portfolio, at amortized cost	$	15,018.1		$	14,942.5		$	14,755.8		$	15,593.3		$	15,908.9		$	15,372.2		$	15,625.0		$	2,538.9
Equity securities portfolio, at cost		1,743.0			1,661.5			1,852.6			1,436.5			1,457.8			1,046.3			659.2			775.7
Short term investments, at fair value (1)		949.3			884.4			757.1			366.0			235.1			1,023.1			571.7			1,096.5
Other invested assets, at carrying value (2)		771.7			645.9			643.1			537.4			383.7			433.9			434.9			179.8
		18,482.1			18,134.3			18,008.6			17,933.2			17,985.5			17,875.5			17,290.8			4,590.9
Ending invested assets:
Debt securities portfolio, at amortized cost	$	14,875.8		$	15,018.1		$	14,942.5		$	14,755.8		$	15,593.3		$	15,908.9		$	15,372.2		$	15,625.0
Equity securities portfolio, at cost		1,804.7			1,743.0			1,661.5			1,852.6			1,436.5			1,457.8			1,046.3			659.2
Short term investments, at fair value (1)		1,317.9			949.3			884.4			757.1			366.0			235.1			1,023.1			571.7
Other invested assets, at carrying value (2)		641.9			771.7			645.9			643.1			537.4			383.7			433.9			434.9
		18,640.3			18,482.1			18,134.3			18,008.6			17,933.2			17,985.5			17,875.5			17,290.8
Average invested assets	$	18,561.2		$	18,308.2		$	18,071.5		$	17,970.9		$	17,959.4		$	17,930.5		$	17,583.2		$	10,940.9
Investment book yield		0.7	%		0.6	%		0.6	%		0.7	%		0.4	%		0.5	%		0.5	%		0.5	%
Annualized investment book yield		2.8	%		2.5	%		2.2	%		2.6	%		1.7	%		2.0	%		2.1	%		1.9	%

(1) Fair value approximates amortized cost.

(2) Carrying value primarily reflects the equity method of accounting for certain private equity and partnerships, and to a lesser extent, fair value or cost for certain other investments.

PAGE 19

ALLEGHANY CORPORATION AND SUBSIDIARIES

LOSS AND LOSS ADJUSTMENT EXPENSE (LAE)

(in millions)

	Twelve Month Ended December 31,
	2013			2012
Reserves, beginning of period	$	12,239.8		$	2,313.0
Less: reinsurance recoverables(1)		1,305.9			831.8
Net reserves, beginning of period		10,933.9			1,481.2
Reserves acquired(2)		—			9,156.1
Incurred loss, net of reinsurance, related to:
Current year		2,682.3			2,642.6
Prior years		(203.0	)		(12.3	)
Total incurred loss and LAE, net of reinsurance		2,479.3			2,630.3
Paid loss, net of reinsurance, related to:
Current year		518.5			1,950.5
Prior years		2,236.8			369.5
Total paid loss and LAE, net of reinsurance		2,755.3			2,320.0
Foreign exchange effect		(7.5	)		(13.7	)
Net reserves, end of period		10,650.4			10,933.9
Less: reinsurance recoverables(1)		1,302.1			1,305.9
Reserves, end of period	$	11,952.5		$	12,239.8

(1) Reinsurance recoverables in this table include only ceded loss and LAE reserves.

(2) Represents the carrying value of TransRe’s net reserves acquired in the merger. Gross loss and LAE reserves and ceded loss and LAE reserves as of the completion of the merger on March 6, 2012 were $9,627.8 million and $471.7 million, respectively.

PAGE 20

ALLEGHANY CORPORATION AND SUBSIDIARIES

CAPITAL STRUCTURE AND LEVERAGE RATIOS

(in millions)

	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Capital Structure
Senior Notes	$	1,794.4		$	1,798.7		$	1,803.0		$	1,807.3		$	1,811.5		$	1,815.7		$	1,819.8		$	1,423.9
Total stockholders’ equity attributable to Alleghany stockholders		6,923.8			6,716.5			6,498.4			6,625.3			6,403.8			6,581.1			6,280.1			6,183.1
Total capitalization	$	8,718.2		$	8,515.2		$	8,301.4		$	8,432.6		$	8,215.3		$	8,396.8		$	8,099.9		$	7,607.0
Leverage ratios
Debt to total capitalization		0.21			0.21			0.22			0.21			0.22			0.22			0.22			0.19
Closing stockholders’ equity attributable to Alleghany stockholders	$	6,923.8		$	6,716.5		$	6,498.4		$	6,625.3		$	6,403.8		$	6,581.1		$	6,280.1		$	6,183.1
Net premiums written (trailing 12 months)	$	4,287.4		$	4,309.4		$	4,318.5		$	4,383.7		$	3,723.9		$	2,874.0		$	2,021.4		$	1,042.3
Net premiums written (trailing 12 months) to stockholders’ equity		0.62			0.64			0.66			0.66			0.58			0.44			0.32			0.17
Total investments and cash	$	19,490.5		$	19,212.0		$	18,783.1		$	19,090.5		$	18,976.4		$	19,031.2		$	18,505.5		$	18,034.7
Total investments and cash to stockholders’ equity		2.82			2.86			2.89			2.88			2.96			2.89			2.95			2.92
Reserve for losses and loss expenses	$	11,952.5		$	12,030.3		$	12,029.8		$	12,051.5		$	12,239.8		$	11,830.8		$	11,720.9		$	11,870.3
Deduct: reinsurance recoverable on ceded losses		(1,302.1	)		(1,310.5	)		(1,271.0	)		(1,269.8	)		(1,305.9	)		(1,232.3	)		(1,237.7	)		(1,256.4	)
Net reserve for losses and loss expenses		10,650.4			10,719.8			10,758.8			10,781.7			10,933.9			10,598.5			10,483.2			10,613.9
Net reserve for losses and loss expenses to stockholders’ equity		1.54			1.60			1.66			1.63			1.71			1.61			1.67			1.72

PAGE 21

ALLEGHANY CORPORATION AND SUBSIDIARIES

SHARE REPURCHASE DETAIL - CURRENT YEAR

Period	Total Number of Shares Repurchased		Average Price Paid per Share		Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs*		Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions)*
January 1 to January 31, 2013		82,599	$	350.40		82,599	$	253.3
February 1 to February 28, 2013		4,277		364.42		4,277		251.7
March 1 to March 31, 2013		2,875		373.75		2,875		250.7
Total		89,751	$	351.82		89,751
April 1 to April 30, 2013		1,503	$	374.95		1,503		250.1
May 1 to May 31, 2013		—		—		—		250.1
June 1 to June 30, 2013		21,906		376.59		21,906		241.9
Total		23,409	$	376.49		23,409
July 1 to July 31, 2013		—	$	—		—		241.9
August 1 to August 31, 2013		—		—		—		241.9
September 1 September 30, 2013		—		—		—		241.9
Total		—	$	—		—
October 1 to October 31, 2013		—	$	—		—		241.9
November 1 to November 30, 2013		—		—		—		241.9
December 1 to December 31, 2013		—		—		—		241.9
Total		—	$	—		—

* In October 2012, Alleghany’s Board of Directors authorized the repurchase of shares of our common stock, at such times and at prices as management determines advisable, up to an aggregate of $300.0 million.

PAGE 22

ALLEGHANY CORPORATION AND SUBSIDIARIES

BASIC AND DILUTED EARNINGS PER SHARE INFORMATION - CONSECUTIVE QUARTERS

(in millions, except share and per share data)

	Three Months Ended
	December 31, 2013		September 30, 2013		June 30, 2013		March 31, 2013		December 31, 2012			September 30, 2012		June 30, 2012		March 31, 2012
Net earnings attributable to Alleghany stockholders	$	205.3	$	113.2	$	113.7	$	196.3	$	(92.6	)	$	125.4	$	109.3	$	560.1
Effect of dilutive securities		—		—		—		—		—			—		0.1		0.2
Income available to common stockholders for diluted earnings per share	$	205.3	$	113.2	$	113.7	$	196.3	$	(92.6	)	$	125.4	$	109.4	$	560.3
Weighted average common shares outstanding applicable to basic earnings per share		16,766,192		16,766,192		16,781,461		16,822,056		16,925,994			16,931,811		16,930,548		10,945,269
Effect of dilutive securities		—		—		—		—		—			—		19,789		28,160
Adjusted weighted average common shares outstanding applicable to diluted earnings per share		16,766,192		16,766,192		16,781,461		16,822,056		16,925,994			16,931,811		16,950,337		10,973,429
Basic earnings per share attributable to Alleghany stockholders	$	12.24	$	6.75	$	6.78	$	11.67	$	(5.47	)	$	7.41	$	6.46	$	51.17
Diluted earnings per share attributable to Alleghany stockholders		12.24		6.75		6.78		11.67		(5.47	)		7.41		6.45		51.06

PAGE 23

ALLEGHANY CORPORATION AND SUBSIDIARIES

BASIC AND DILUTED EARNINGS PER SHARE INFORMATION - YEAR-TO-DATE

(in millions, except share and per share data)

	Twelve Month Ended December 31,
	2013		2012
Net earnings attributable to Alleghany stockholders	$	628.4	$	702.2
Effect of dilutive securities		—		—
Income available to common stockholders for diluted earnings per share	$	628.4	$	702.2
Weighted average common shares outstanding applicable to basic earnings per share		16,786,608		15,441,578
Effect of dilutive securities		—		—
Adjusted weighted average common shares outstanding applicable to diluted earnings per share		16,786,608		15,441,578
Basic earnings per share attributable to Alleghany stockholders	$	37.44	$	45.48
Diluted earnings per share attributable to Alleghany stockholders		37.44		45.48

PAGE 24

ALLEGHANY CORPORATION AND SUBSIDIARIES

RETURN ON AVERAGE STOCKHOLDERS’ EQUITY - CONSECUTIVE QUARTERS

(in millions)

	Three Months Ended
	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Opening stockholders’ equity attributable to Alleghany stockholders	$	6,716.5		$	6,498.4		$	6,625.3		$	6,403.8		$	6,581.1		$	6,280.1		$	6,183.1		$	2,925.7
Closing stockholders’ equity attributable to Alleghany stockholders		6,923.8			6,716.5			6,498.4			6,625.3			6,403.8			6,581.1			6,280.1			6,183.1
Average stockholders’ equity	$	6,820.1		$	6,607.5		$	6,561.9		$	6,514.6		$	6,492.5		$	6,430.6		$	6,231.6		$	4,554.4
Net earnings attributable to Alleghany stockholders	$	205.3		$	113.2		$	113.7		$	196.3		$	(92.6	)	$	125.4		$	109.3		$	560.1
Return on average stockholders’ equity		3.0	%		1.7	%		1.7	%		3.0	%		–1.4	%		2.0	%		1.8	%		12.3	%
Annualized return on average stockholders’ equity		12.0	%		6.9	%		6.9	%		12.1	%		–5.7	%		7.8	%		7.0	%		49.2	%

PAGE 25

ALLEGHANY CORPORATION AND SUBSIDIARIES

RETURN ON AVERAGE STOCKHOLDERS’ EQUITY - YEAR-TO-DATE

(in millions)

	Twelve Month Ended December 31,
	2013			2012
Opening stockholders’ equity attributable to Alleghany stockholders	$	6,403.8		$	2,925.7
Closing stockholders’ equity attributable to Alleghany stockholders	$	6,923.8		$	6,403.8
Average stockholders’ equity	$	6,663.8		$	4,664.8
Net earnings attributable to Alleghany stockholders	$	628.4		$	702.2
Return on average stockholders’ equity		9.4	%		15.1	%
Annualized return on average stockholders’ equity		9.4	%		15.1	%

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ALLEGHANY CORPORATION AND SUBSIDIARIES

BOOK VALUE PER SHARE

(in millions, except share and per share data)

	December 31, 2013			September 30, 2013			June 30, 2013			March 31, 2013			December 31, 2012			September 30, 2012			June 30, 2012			March 31, 2012
Total stockholders’ equity attributable to Alleghany stockholders	$	6,923.8		$	6,716.5		$	6,498.4		$	6,625.3		$	6,403.8		$	6,581.1		$	6,280.1		$	6,183.1
Shares outstanding		16,766,192			16,766,192			16,766,192			16,785,308			16,890,623			16,932,328			16,930,793			16,928,664
Book value per share	$	412.96		$	400.60		$	387.59		$	394.71		$	379.13		$	388.67		$	370.93		$	365.24
Quarter-over-Quarter growth		3.1	%		3.4	%		–1.8	%		4.1	%		–2.5	%		4.8	%		1.6	%		6.8	%

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ALLEGHANY CORPORATION AND SUBSIDIARIES

CATASTROPHE EXPOSURE

The business of our reinsurance and insurance subsidiaries exposes them to losses from various catastrophe events. In a catastrophe event, losses from many insureds across multiple lines of business may result directly or indirectly from such single occurrence. Our reinsurance and insurance subsidiaries take certain measures to mitigate the impact of catastrophe events through various means including considering catastrophe risks in their underwriting and pricing decisions, purchasing reinsurance, monitoring and modeling accumulated exposures, and managing exposure in key geographic zones and product lines that are prone to catastrophic events.

Natural disasters such as hurricanes, other windstorms, earthquakes and other catastrophes have the potential to materially and adversely affect our operating results. Other risks, such as an outbreak of a pandemic disease, a major terrorist event, the bankruptcy of a major company or a marine and/or aviation disaster, could also have a material adverse effect on our business and operating results.

We evaluate catastrophic events and assess the probability of occurrence and magnitude through the use of industry recognized models and other techniques. We supplement these models by judgmentally interpreting and adjusting when appropriate the modeled output and by periodically monitoring the exposure risks of our operations. There is no single standard methodology to project possible losses from catastrophe exposures. Further, there are no industry standard assumptions used in projecting these losses, and the form and quality of the data obtained, including data obtained from insureds and ceding companies, and used in these models are not uniformly compatible with the data requirements of all models. Therefore, the use of different methodologies and assumptions could materially change the projected losses. Finally, these modeled losses may not be comparable with estimates made by other companies.

Although the analytical tools used to estimate catastrophe exposure are useful in both pricing and monitoring catastrophe risk, the estimates derived by use of these techniques are inherently uncertain and do not reflect our maximum exposures to these events. Although the models are frequently updated, these projections are nevertheless inherently imprecise. It is highly likely that our losses will vary, perhaps materially, from these estimates.

Projections of potential catastrophe losses are typically expressed in terms of the probable maximum loss, or “PML.” We define PML as our anticipated maximum loss (taking into account contract limits) caused by a single catastrophic event at a specified estimated return period affecting a broad contiguous area. These modeled losses are estimated based upon contracts in force at January 1, 2014 for TransRe and December 1, 2013 for RSUI.

The following is an overview of such modeled PMLs from property, engineering, marine and energy exposures and the associated natural perils that we deem most significant. The estimated amount of these modeled losses are presented for both a 100 year return period (having a likelihood of being exceeded in any single year of 1.0 percent), and a 250 year return period (having a likelihood of being exceeded in any single year of 0.4 percent), and are presented in two ways: (i) gross catastrophe losses; and (ii) after-tax net catastrophe costs such as gross losses, net of reinsurance, net reinstatement premiums and taxes. The reduction for reinsurance assumes that all reinsurers fulfill their obligations in accordance with contract terms.

	100 Year Return Period				250 Year Return Period
	Gross Loss		Net Loss		Gross Loss		Net Loss
	(before tax)		(after tax)		(before tax)		(after tax)
	(in billions)
Florida, Wind	$	1.2	$	0.5	$	1.8	$	0.8
California, Earthquake		1.0		0.4		1.6		0.6
Northeast U.S., Wind		0.7		0.4		1.5		0.7
Gulf Coast, Wind		0.9		0.3		1.5		0.6
Europe, Wind		0.6		0.3		0.8		0.4
Japan, Earthquake		0.5		0.2		0.7		0.3
Japan, Wind		0.5		0.2		0.5		0.2

“Florida, Wind” has the highest modeled after-tax net catastrophe costs for both a 100 year and 250 year return periods. These costs would represent approximately 7 percent and 11 percent, respectively, of stockholders’ equity as of December 31, 2013. If multiple severe catastrophic events occur in any one year, or a single catastrophic event affects more than one geographic area, the potential economic cost to us could be materially higher than any one of the amounts shown above.

There is much uncertainty and imprecision in the compilation of these estimates at many stages in the process. Moreover, the makeup of our in-force business is constantly changing as new business is added and existing contracts terminate or expire, including contracts for reinsurance coverage purchased by us. In addition, these estimates take into account what we believe to be the most likely accumulation of territories, but there can be no assurance that we have captured every possible scenario in our analysis. As a result of these factors, among others, there can be no assurance that we will not experience after-tax net catastrophe costs from individual events that will exceed these estimates by a material amount. There also can be no assurance that we will not experience catastrophe events more frequently than the modeled probabilities would suggest. In any given year, catastrophe events could have a material adverse effect on our financial condition, results of operations, cash flows and liquidity.

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ALLEGHANY CORPORATION AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURES

Throughout this Financial Supplement, Alleghany’s results of operations are presented in the way that Alleghany believes will be the most meaningful and useful to investors, analysts, rating agencies and others who use financial information in evaluating Alleghany’s performance. This Financial Supplement includes various “non-GAAP financial measures” under U.S. Securities and Exchange Commission rules and regulations. These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for measures of operating performance prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). When such measures are disclosed, reconciliations to the most comparable GAAP measure are provided.

UNDERWRITING PROFIT

Underwriting profit represents net premiums earned less net loss and LAE and commissions, brokerage and other underwriting expenses, all as determined in accordance with GAAP, and does not include net investment income, net realized capital gains, OTTI losses, other income, other operating expenses, amortization of intangible assets or interest expense. Alleghany consistently uses underwriting profit as a supplement to earnings before income taxes, the most comparable GAAP financial measure, to evaluate the performance of its segments and believes that underwriting profit provides useful additional information to investors because it highlights net earnings attributable to a segment’s underwriting performance. Earnings before income taxes may show a profit despite an underlying underwriting loss, and when underwriting losses persist over extended periods, a reinsurance or an insurance company’s ability to continue as an ongoing concern may be at risk. A reconciliation of underwriting profit to earnings before income taxes is presented within “Consolidated Underwriting Results” on pages 10 to 13 of the Financial Supplement.

OPERATING INCOME (AND OPERATING INCOME PER SHARE)

Operating income and operating income per share exclude on an after-tax basis: net realized capital gains; other than temporary impairment losses; gain on bargain purchase; amortization of intangible assets; and merger-related transaction costs, all as determined in accordance with GAAP. Alleghany uses operating income and operating income per share as a supplement to net earnings attributable to Alleghany stockholders and earnings per share, respectively, the most comparable GAAP financial measures, to provide useful additional information to investors by highlighting net earnings and earnings per share attributable to its performance exclusive of non-recurring merger-related impacts, realized investment gains or losses, and impairments. A reconciliation of operating income and operating income per share to net earnings attributable to Alleghany stockholders and earnings per share, respectively, is presented within “Operating Income Reconciliation” on page 30 of the Financial Supplement.

ANNUALIZED INVESTMENT BOOK YIELD

Annualized investment book yield is calculated by dividing net investment income by average aggregate invested assets at book value. In calculating annualized investment book yield, net investment income for the period, determined in accordance with GAAP, is multiplied by the number of such periods in a calendar year in order to arrive at annualized net investment income. Alleghany utilizes and presents annualized investment book yield in order to better disclose the performance of its investments.

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ALLEGHANY CORPORATION AND SUBSIDIARIES

OPERATING INCOME RECONCILIATION

(in millions, except share and per share amounts)

	Three Months Ended December 31,						Twelve Month Ended December 31,
	2013			2012			2013			2012
Net earnings attributable to Alleghany stockholders	$	205.3		$	(92.6	)	$	628.4		$	702.2
Adjustments to net earnings (after tax):
Net realized investment gains		88.7			24.7			150.9			102.6
Other than temporary impairment charges		(1.4	)		—			(28.6	)		(1.9	)
Amortization of intangible assets*		0.9			(25.9	)		6.6			(164.6	)
Gain on bargain purchase*		—			—			—			494.9
Transaction costs*		—			—			—			(25.5	)
		88.2			(1.2	)		128.9			405.5
Operating income	$	117.1		$	(91.4	)	$	499.5		$	296.7
Weighted average common shares outstanding:
Basic		16,766,192			16,925,994			16,786,608			15,441,578
Diluted		16,766,192			16,925,994			16,786,608			15,441,578
Earnings per share attributable to Alleghany stockholders:
Basic	$	12.24		$	(5.47	)	$	37.44		$	45.48
Diluted		12.24			(5.47	)		37.44			45.48
Operating earnings per share data:
Basic	$	6.99		$	(5.40	)	$	29.76		$	19.22
Diluted		6.99			(5.40	)		29.76			19.22

* Merger-related items associated with the merger with TransRe include a gain on bargain purchase resulting from the application of purchase accounting treatment, amortization of intangible assets and transaction costs. Amortization of intangible assets include immaterial amounts of ongoing amortization arising from the acquisition of subsidiaries other than TransRe. With respect to taxes, the gain on bargain purchase did not result in a corresponding increase in income taxes, and certain of the transaction costs incurred were non-deductible.

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