Arch Capital Group has improved its profits year-on-year by $14 million, despite writing less premiums in the third quarter compared with the same period a year ago.

The Bermuda-based company, with $4.17 billion in capital, had gross written premiums for the past three months of just under $1 billion. The net income available to shareholders in the quarter was $199.7 million, or $2.76 per share, up 32 cents.

Operating income after tax improved to $209.3 million equates to $2.89 per share, which is again an improvement and represents a 24.4 percent annualised return on average common equity for the third quarter.

The company's combined ratio edged slightly higher to 84.8 percent, while its capital of $4.17 billion has improved by $248.2 million during 2007 mostly as a result of operating income and after-tax increase in the fair value of the company's investment portfolio, although this has been partially offset by a $400 million share buyback.