The floating of Axis Specialty yesterday confirmed Bermuda as the world centre for insurance and reinsurance, said Michael Butt, chairman of the company.

Yesterday Axis started trading on the New York Stock Exchange under the ticker symbol AXS, raising $473 million and trading at the top end of the scale at $22 and moving up 16 percent to $25.50 during the day.

Mr. Butt said: “It is a milestone in the history of the Island in establishing itself as the centre for global insurance and reinsurance.

“In the ten years since the cat(astrophe insurance) companies were formed (in the wake of Hurricane Andrew), the ability to build lasting businesses based in Bermuda has impressed the world's buyers who now view Bermuda as the highest quality of market available. The public flotation of Axis today confirms the position of Bermuda as the world centre for insurance and reinsurance.”

The company is the latest in a line of Bermuda post-September 11 start-ups to float on the exchange - Endurance Specialty Holdings Ltd. made its own NYSE debut on February 28 at $23 a share, and began Tuesday at $29.85. Montpelier Re Holdings Ltd. trades at $31.60, well above its own $20 offering price. Montpelier began initial trading on October 10.

Axis, which has its offices on Pitts Bay Road in Hamilton, has seen its Bermuda staff treble in the 18 months since it came into being and has opened offices around the world.

“When Bob (Robert Newhouse) and I set the company up back in October, 2001 it was because we genuinely believed that the World Trade Center tragedy was a transformational moment, not only for the world and its relationships with each other, but also for the insurance and reinsurance industry,” said John Charman, president and chief executive officer of the company.

“It was transformational in the fact that it forced at long last the modernisation of the last of the financial services (insurance). And the opportunity was to create the leading diversified specialty insurance and reinsurance company in the world as measured by quality, sustainability and profitability. And I want to emphasise the leading as opposed to one of the leading.”

Mr. Charman added that this was not a bad mission statement to come out with from the very inception of the company.

“I think this goes against everything and everybody that criticises start-ups,” he added. Last week Fitch in a report, said that the Bermuda start-ups were not as safe an investment as the more established insurance companies.

“From the very beginning we had a very strong commitment to creating a new age company because most of the traditional companies were overwhelmed by cost, people and infrastructure. As I said at the very inception of Axis that we were going to create a modern structure as a business platform and we were going to find the highest talent, we were going to use the best technology and we were going to outsource as much of our back office as we could, because I do not want to be famous for processing.

And Mr. Charman said that over the past 18 months the company has demonstrated that they have moved significantly towards achieving that goal.

“And that is against the backdrop of a global industry where legacy businesses cannot escape from the sins of their past, and shareholders equity is being persistently and consistently impaired from old year losses and past year liabilities.

“We believe that the group of businesses in the last quarter of 2001 have exemplified a new approach, a more modern approach, a more disciplined approach to the global insurance and reinsurance business and will continue to do so.”

The initial public offering of 21.5 million shares, led by Morgan Stanley and Citigroup Inc., priced above estimates of $19.50 to $21.50 a share.

Axis, Allied World Insurance Company, Arch Capital Group, DaVinci Re, Endurance Specialty, Montpelier Re, Olympus Re all set up within months of each other in Bermuda with an initial capial of $7.3 billion between them.

At the time, many existing insurers were addled by the heavy claims losses brought on by the attacks, combined with the new terrorism-claims exposure these companies faced. Many of these same insurers also faced older liabilities from asbestos and environmental claims, and deep losses in their investment portfolios. This, and a need worldwide for new insurance capacity, prompted a move to set up new insurers unencumbered by the problems of the industry. Since the attacks, $15 billion of new capital was invested in insurance businesses in Bermuda, according to data from Axis included in its offering documents filed with the Securities and Exchange Commission.

In 2002, its first full year, the company had $1.1 billion in gross premiums written, for net income of $265.1 million and in the first quarter of this year, Axis reported $107.1 million in net income on $608.6 million in gross premiums.

Unlike many IPOs, Axis plans to pay a dividend to shareholders. It plans initially to pay holders seven cents a share each quarter. Some existing investors in Axis, including Marsh & McLennan Cos., J.P. Morgan Chase & Co., The Blackstone Group and Thomas H. Lee Partners, cashed out part of their investments in the IPO. Of the 21.5 million shares sold, 8.1 million shares were offered by existing holders.