Bermuda company Trenwick saw its stock value nose dive yesterday as investors reacted to news of nearly $140 million in net losses for the third quarter.

The company's share price has taken a beating in recent months but fell to a 52-week low yesterday with investors pushing the share value down 40 percent - closing at $1.56. In marked contrast the company's 52-week high stood at $11.05

The troubled insurer posted an operating loss of $135 million for the third quarter period ending September 30 and net loss of $137.2 million.

For the nine months, the company posted an operating loss of $142.6 million and net loss of $188 million. Trenwick's poor third quarter result was more bad news for company investors who have seen the group post wide losses in recent quarters, although the company did post net income of $3.8 million last quarter and $6.5 million in operating income for the second quarter, 2002.

But comparison of this quarter's results with the previous year show that Trenwick's $137.2 million net loss this quarter compared to a net loss of $96.1 million for the same period a year ago. Beyond the losses posted, the company was also delisted recently from the Bermuda Stock Exchange (BSX), had its financial strength ratings downgraded and ceased to write US Specialty business after a recent deal struck with Chubb Re.

Earlier in the year the company also effected a 100 percent quota share reinsurance agreement with new Bermuda insurer Endurance, on in-force business from its property catastrophe subsidiary LaSalle.

Acting CEO W. Marston Becker said the losses had resulted from actions to "improve the quality of its balance sheet": "The increase in Trenwick's loss reserves and the introduction of a deferred tax valuation reserve in the third quarter reflects Trenwick's commitment to improving the quality of its balance sheet. "These actions, along with any appropriate adjustments to loss reserves following completion of the current review by independent actuarial consultants, will provide Trenwick with an appropriate base upon which it can rebuild credibility with policyholders, shareholders and rating agencies," he said.

The company did however record business during the quarter with gross premiums written of $389.8 million and net premiums written of $182.3 million compared to $367.5 million and $242.8 million, respectively, for the quarter ended September 30, 2001. And in mid-September the company got a cash injection from Berkshire Hathaway when it agreed to provide additional Lloyd's funding and a qualifying quota share reinsurance facility to Trenwick's Lloyd's Syndicate 839.

But this did result in a reduction of Trenwick's net premiums written for the third quarter and the first nine months of 2002 compared to 2001 with $93.8 million of cessions made to Berkshire Hathaway, under the agreement with Trenwick's Lloyd's Syndicate 839.