Bermuda's Max Re Capital Ltd. yesterday reported 166 percent growth in fourth quarter net income and profitable operating results for the year.

Net income for the three months ended December 31, 2001 was $10.1 million, or $0.26 per share, compared with net income of $3.8 million, or $0.14 per share for the three months ended December 31, 2000, while net income for the year ended December 31, 2001 was $2.5 million, or $0.08 per share, compared with net income of $8.7 million, or $0.36 per share, for the year ended December 31, 2000.

Chairman, President and Chief Executive Officer Robert J. Cooney said yesterday: "We were pleased that Max Re recorded strong premium growth combined with satisfactory investment returns for the fourth quarter 2001. This allowed us to rebound from the poor third quarter financial result, impacted by the September 11 tragedy, and produce a profit for 2001."

Gross written premiums and deposits received for the three months ended December 31, 2001 were $243.7 million, compared to $103.5 million for the same period of 2000, an increase of 135 percent.

Net written premiums for the three months ended December 31, 2001 were $202.3 million, compared to $95.6 million for the same period of 2000 and net earned premiums for the three months ended December 31, 2001 were $243.7 million, compared to $112.9 million for the same period of 2000.

The Company's gross written premiums and deposits received increased 97 percent to $806.7 million for the year ended December 31, 2001, from $409.7 million for 2000.

Net written premiums for the year ended December 31, 2001 were $594.1 million, compared to $401.8 million for the year ended December 31, 2000. Net earned premiums for the year ended December 31, 2001 were $500.9 million, compared to $401.4 million for the year ended December 31, 2000.

Total revenue for the three months ended December 31, 2001 was $272.8 million, compared to $146.7 million for the same period of 2000. Total revenue for the year ended December 31, 2001 was $581.0 million, an increase of 29 percent, compared to $451.3 million for 2000.

The Company's cost of funds declined to 6.31 percent as of December 31, 2001 from 6.33 percent as of September 30, 2001. General and administrative expenses for the three months ended December 31, 2001 were $6.4 million, a 3.2 percent increase over the $6.2 million for the same period of 2000. General and administrative expenses for the year ended December 31, 2001 were $21 million, or 3.61 percent of net earned premium and deposits received, compared to $16.4 million, or 4.09 percent of net earned premium and deposits received for the year ended December 31, 2000.

The total return on the fixed-maturities portfolio was 0.51 percent for the three months ended December 31, 2001, which resulted in a total return of 8.55 percent for the year ended December 31, 2001. The total return on the fixed-maturities portfolio was 9.61 percent for the year ended December 31, 2000.

Net gains on alternative investments for the three months ended December 31, 2001 was $14.4 million, or 2.61 percent, compared to net gains on alternative investments of $9.4 million, or 2.40 percent, for the same period of 2000. Net gains on alternative investments for the year ended December 31, 2001 were $29.8 million, or 6.69 percent, compared to $9.6, or 4.22 percent, for the year ended December 31, 2000.

The rate of return on the company's invested asset portfolio (both fixed maturities and alternative investments) was 7.78 percent for the year ended December 31, 2001, compared to 7.81 percent for the year ended December 31, 2000.

Invested assets increased to $1.6 billion as of December 31, 2001, with an allocation of 61.0 percent to cash and fixed maturities and an allocation of 39.0 percent to alternative investments. The ratio of invested assets to minority interest and total shareholders' equity was 2.32 at December 31, 2001, compared to 1.67 at December 31, 2000.

Minority interest and shareholders' equity reached $699.7 million at December 31, 2001. Combined book value per share, including conversion of the non-voting Max Re Ltd. common shares held by the founding investors, at December 31, 2001 was $14.92.

Max Re Capital Ltd., through its principal operating subsidiary, Max Re Ltd., offers customised reinsurance solutions to property and casualty insurers, life and health insurers, and large corporations.