Arch Capital Group posted income of $137.8 million for the 2006 second quarter compared to income of $126 million for the 2005 second quarter.

Earnings per share were $1.81 compared to $1.69 for the 2005 second quarter.

The Bermuda-based company posted operating income of $171 million, or $2.24 per share in the 2006 second quarter, compared to $113.1 million, or $1.52 per share, for the 2005 second quarter.

Arch was expected to make $1.98 a share, according to the average estimate of 13 analysts in a Thomson First Call survey.

Net investment income rose to $90.5 million as a result of a higher level of average invested assets primarily due to cash flow from operations.

Arch shares closed at $58.80 yesterday, down 84 cents or 1.41 percent on a volume of 173,385 shares on the New York Stock Exchange.

l Net Income available to common shareholders: $137.8 million, a 9 percent improvement from $126 million in the second quarter 2005

l Net income broken down per share: $1.81 per share compared to $1.69 per share a year ago

Operating income: $171 million, a 51 percent improvement from $113.1 million in the same quarter a year ago

Gross premiums written: $1.14 billion, 21 percent improvement from $940.8 million in the same period a year ago

Net premiums written: $794.6 million, a 10 percent improvement from $723.7 million in the same period a year ago

Net investment income: $90.5 million, a 69 percent improvement from $53.7 million a year ago

Combined ratio: 86.3 percent compared to 89.4 percent during the same period a year ago

Shareholders? equity increased to $3 billion at June 30, 2006 compared to $2.5 billion at December 31, 2005