Consolidated Balance Sheets
The National Catholic Risk Retention Group, Inc. and Subsidiaries
    ASSETS   At December 31, 2006     At December 31, 2005    
    Fixed-maturity securities, at market value   $28,774,240     $24,579,309    
    Equity investments, at market value   30,354,669     28,623,210    
    Cash and cash equivalents   9,764,899     10,329,751    
    Accrued investment income   351,499     457,964    
    Premiums receivable   1,017,752     351,894    
    Reinsurance receivable on paid losses   439,037     3,496,013    
    Reinsurance recoverable on case reserves   3,800,000     9,217,764    
    Reinsurance recoverable on IBNR reserves   10,756,990     9,677,220    
    Prepaid reinsurance premium   3,600,345     5,441,767    
    Deferred policy acquisition costs   232,161     288,843    
    Other assets   376,663     132,119    
    TOTAL ASSETS   $89,468,255     $92,595,854    
    LIABILITIES AND SHAREHOLDERS' EQUITY              
    Liabilities              
    Losses and loss adjustment expenses   $42,142,906     $47,176,840    
    Unearned premiums   7,947,782     10,089,189    
    Reinsurance payable   338,086     650,837    
    Premium taxes payable   186,758     272,773    
    Unearned ceding commissions   338,776     513,693    
    Other liabilities   61,831     118,405    
    Total Liabilities   51,016,139     58,821,737    
    Shareholders' Equity              
    Capital Stock:              
    Class A ($20 par value, 200 shares authorized,
67 and 65 shares issued and outstanding)		   1,340     1,300    
    Class B ($40 par value, 30,000 shares authorized,
7,465.54 and 7,470.10 shares issued and outstanding)		   298,622     298,804    
    Additional paid-in capital - original requirements   484,001     474,375    
    Additional paid-in capital - policyholder dividends   8,862,640     8,862,640    
    Accumulated other comprehensive income   8,956,581     5,281,192    
    Retained earnings   19,848,932     18,855,446    
    Total Shareholders' Equity   38,452,116     33,774,117    
     
    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY   $89,468,255     $92,595,854    

Note: Johnson Lambert & Co., Certified Public Accountants has audited the financial statements of The National Catholic Risk Retention Group, Inc. and Subsidiaries for the years ended December 31, 2006 and 2005 prepared in conformity with generally accepted accounting principles in the United States, and issued an unqualified opinion on such financial statements in their report dated April 5, 2007. The auditor's report applies to the complete financial statements which are not presented.

These consolidated balance sheets, consolidated statements of operations and comprehensive income, consolidated statements of changes in shareholders' equity and consolidated statements of cash flows of The National Catholic Risk Retention Group, Inc. and Subsidiaries for the years ended December 31, 2006 and 2005 were derived from the audited financial statements. The complete audited financial statements may be obtained from The National Catholic Risk Retention Group, Inc. and Subsidiaries at 801 Warrenville Road, Suite 175, Lisle, IL 60532-4334.

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