Bermuda-based PartnerRe Ltd said it was looking forward to an improvement in the world reinsurance market despite reporting a drop in net income of 66 percent for the first quarter in 2000.

According to the company the decrease reflects the impact after tax realised investment losses of $38.8 million or 78 cents a share.

Operating Earnings were up from $1.11 to $1.14 per share compared to the same period in 1999, line with management's expectations.

For the three months ended March 31, 2000, operating earnings available to common shareholders excluding net realised investment gains and losses, i.e.

operating earnings, were $57.1 million, or $1.14 per share, compared to operating earnings of $61.8 million, or $1.11 per share, for the first quarter of 1999.

Herbert N. Haag, President & Chief Executive Officer of PartnerRe, said: "Our premium level in the first quarter 2000 reflects the significant effort of the company to influence reinsurance conditions and our ability to retain more business within our group, despite the strengthening of the U.S. Dollar against European currencies.

"We expect the gradual improvements initiated at the end of last year will manifest themselves in the results of future quarters. In this quarter, the difficult 1999 underwriting year continued to influence the results, including some adverse development from the European storms at the end of December 1999.'' Diluted net income per share for the three months ended March 31, 2000 was $0.36 compared to net income per share of $1.15 for the first quarter of 1999.

At March 31, 2000, total assets were $7.6 billion and shareholders' equity was $1.9 billion. Diluted book value per common share increased to $32.70 from $31.82 at December 31, 1999.

The company repurchased 109,900 common shares in the first quarter of 2000 under the current authorised programme.

PartnerRe also announced that the board of directors declared a regular quarterly dividend of $0.26 per common share. The dividend is payable on June 1, 2000, to common shareholders of record on May 22, 2000, with the stock trading ex-dividend commencing May 18, 2000.

PartnerRe income falls Net premiums written were $440.1 million for the three months ended March 31, 2000, compared to $408.1 million for the 1999 first quarter.

Total revenues for the first quarter of 2000 were $358.0 million, with $318.3 million of net premiums earned, net investment income of $77.5 million and net realised investment losses of $37.7 million.

Comparable 1999 first quarter revenues were $392.1 million, with $315.8 million of net premiums earned, net investment income of $72.7 million and net realised investment gains of $3.7 million.

Mr. Haag added: "We entered the millennium with expectations for a return to discipline and rational pricing.

"Indications clearly point to improvements in market conditions but, without doubt, further progress on a broader scale is required to achieve the desired profitability.

"This turning of the market, although gradual, allows PartnerRe to capitalise on the many opportunities that exist for a focused and financially strong reinsurer - a position we have highlighted by prioritising our resources through the announced sale of our US life reinsurance operations (subject to normal regulatory approvals).

"We remain convinced that we are well positioned to achieve greater market penetration at improving terms, to the benefit of our shareholders.'' Herbert Haag