Endurance Specialty Holdings Ltd. has repurchased $12 million worth of shares from initial investors Metro Center Investments Pte Ltd., the Bermuda-based reinsurer said on Friday.

Endurance said it bought 350,000 of its ordinary shares for $34.6775 per share, representing a three percent discount to the closing price for the ordinary shares on March 4. Endurance used cash on hand to fund the repurchase.

?This transaction demonstrates our continuing commitment to our capital management strategy of enhancing our return on equity through a selective repurchase of our ordinary shares at an attractive valuation,? said Kenneth J. LeStrange, chairman and chief executive officer, said.

Prior to the sale Metro held 2.1 percent of Endurance?s shares.

Endurance?s buyback comes as insurers and reinsurers move to manage their capital more effectively at a time when premium rates are generally falling, meaning that they require less capital to underwrite risks and may be unable to provide their investors with a similar rate of return compared to past years.

In December, Aon, Endurance?s largest initial investor, sold 9.8 million shares at a net realised price of $32.70 per share resulting in proceeds of $320.5 million. Those shares were sold on the open market.

Aon, the world?s second largest insurance broker which on Friday settled a lawsuit with New York state Attorney General for $190 million, had been criticised for allegedly steering business to Endurance.

Endurance was formed after the September 11, 2001 terrorist attacks with start-up capital of $1.2 billion. It now has a market capitalisation of $2.2 billion.