MBIA Inc., the bond insurer that restated seven years of results in March, said first-quarter profit fell 3.9 percent on fewer investment gains. Sales of new policies more than doubled.

Net income at MBIA, the world?s largest bond insurer, fell to $200.5 million from $208.6 million, the company said in a statement. Per-share earnings rose one cent to $1.43 because the company bought back shares, and profit excluding changes in the value of investments and derivatives was $1.40. That exceeded the $1.34 average estimate of analysts polled by Thomson Financial.

Sales of new policies climbed to $317.6 million from $138 million, signalling that MBIA probably gained market share from Ambac Financial Group Inc., its biggest competitor, William Blair & Co. analyst Mark Lane said. Ambac cut its 2005 sales forecast last month, saying competitors such as MBIA were cutting prices to levels that Ambac didn?t consider profitable.

?Sales growth was significantly above my expectations,? said Lane, who has a ?market perform? rating on the stock. `It does make you ask more questions. It?s always difficult to know if companies are being disciplined or not. They are always complaining about each other.?

MBIA chief executive Gary Dunton said the company was ?able to capitalise on a series of excellent opportunities that met our pricing and underwriting standards.? Insurers often don?t see the impact of under-priced policies until years after the sales as claims occur.

The company had $1.7 million of realised investment and derivatives gains in the quarter, less than the $44.3 million a year earlier.

MBIA in March corrected accounting for a 1998 reinsurance contract that overstated the company?s profit by $54 million through 2004. The insurer made the correction after receiving subpoenas from New York Attorney Eliot Spitzer and the Securities and Exchange Commission, which have subsequently sent more inquiries about MBIA?s accounting. The 1998 reinsurance contract incorrectly allowed MBIA to show fewer losses from insuring bonds of a failed hospital network in Pennsylvania. Proxy adviser Glass Lewis & Co. last month recommended that MBIA investors push to remove chairman Joseph Brown and chief executive Gary Dunton because of the improper accounting. ? Bloomberg