The year began with the troubled tourist sector facing up to the unpleasant reality that the international business sector had drawn level with tourism as the Island's highest foreign revenue earner. The slump in air arrivals during the first eight months of 1992 appeared to be remedied by the US airlines' decision to extend fare discounting to the Bermuda route. The climb in air arrivals continued from September 1992 and for the period January 1, 1993 to July 18 air arrivals were up by 9.5 percent.

The sale of the timeshare complex St. George's Club appeared closer to completion as receiver Price Waterhouse considered an offer from a subsidiary of Canadian-based Trans-America Corporation. St. George's Club owner the York-Hannover group of property companies had been left with the majority of the $79 million total debt. But other foreign creditors voiced alarm that majority owner of Trans-America German-Canadian financier Mr Wolfgang Stolzenberg had close business links with the York-Hannover group.

It later emerged that the sale, through a subsidiary of Trans-America, would transfer all the shares to the club's principal creditor Canadian company Central Guaranty Trust Company.

Creditors of defunct Mentor Insurance unanimously approved a Scheme of Arrangement which allowed virtually all of the company's assets to be distributed to them by late 1994.

Bank of Bermuda president Mr. Donald Lines announced he would retire on April 3, 1994. His successor Mr. Charles Vaughan-Johnson said he was surprised a non-Bermudian had been selected for the post.

FEBRUARY The Finance Ministry's Economic Review indicated Bermuda's economic fortunes would improve as a result of increased US consumer confidence in the US and an end to the three-year decline in the non-Bermudian workforce.

The Bank of Bermuda reported a profit of $17.7 million for the first six months of fiscal 1993, up 28.5 percent on the same period in 1992. The leap was attributed to growth in fee revenues generated by international business in Bermuda and overseas.

The Bermuda Stock Exchange began to daily trading amidst news that deals would not be made electronically to the disappointed of the investment industry.

Budget proposals to cut Government spending, build a new prison and invest $3 million in education reform were scorned by the opposition Progressive Labour Party, who were said to favour a "tax and spend'' Budget. Official figures for unemployment remained at three percent. The increase in car imports, reflecting the introduction of a secondary car ownership market, was described as a temporary blip.

Scandal Night Club was closed for non-payment of $62,000 in rent owed to its landlord. Missing Scandal director Mr. Michael Haegele denied that he stole $500,000 from the business, but Mr. Kenneth DeFontes said the club's takings significantly declined while Mr. Haegele was running the club.

MARCH Trans-America Corporation's bid for the St. George's Club complex collapsed as a result of financing problems.

Centre Reinsurance Holdings formed an "association'' with newly-created New York-based Centre Financial Products, soon after setting up a joint company to underwrite business in the North American market for brokered traditional property and casualty reinsurance.

Bermuda Commercial Bank and First Bermuda Securities devised a scheme to enable Bermudians to invest indirectly in foreign-owned companies while avoiding exchange control restrictions.

A Bermuda International Business Association survey published in March found that many foreign workers felt unappreciated and unwanted by Bermudians.

The Supreme Court ordered the winding up of Trinidad-based company United Security Life Insurance Company (USL) - an unprecedented legal step because the company is domiciled in a foreign country.

APRIL Bermuda-based Corporate Officers & Directors Assurance reported a first quarter profit of $6.7 million -down 5.5 percent on the same quarter in 1992.

An exempted company, CXO, was formed in Bermuda to pursue petroleum refining and marketing opportunites in Asia. Bermuda resident Mr. John Deuss represents the overseas interests of Oman which owns 40 percent of CXO.

A $200 million loss on an explosion and fire at a French oil refinery was largely responsible for an operational loss of $124 million for fiscal 1992 for Bermuda-based OIL Insurance.

Excess liability Oil Casualty Insurance Ltd. (OCIL) suffered a $16.2 million in 1992, after receiving its third largest loss report in its six and a half years in operation.

Bermuda had a strong Government and industry presence at this year's Risk & Insurance Management Society's conference in Orlando, attended by the Premier the Hon. Sir John Swan.

COMPANY RESULTS IMPROVED IN FIRST HALF MAY Barclays Bank's sale of its 32 percent stake in Bermuda Commercial Bank to Mr.

John Deuss' First Curacao International Bank was unanimously approved by shareholders. An increase in authorised share capital from $4.8 million to $7.2 million was also approved, although shareholders were visibly shocked that FCIB had a workforce of just six. Mr. Deuss took over as BCB chairman from the Hon. Clarence Terceira.

Bermuda's offshore insurance industry escaped punishing taxes that potentially risked damaging Bermuda's captive market when plans considered by the Clinton Administration to increase Federal Excise Tax (FET) on insurance premiums ceded to offshore domiciles were dropped.

Insurance firm ACE reported a profit of $64.3 million for the second quarter of fiscal 1993 - up 74 percent on the same period in 1992.

Insurance firm BF&M reported a profit of $7.2 million for fiscal 1992 -the company's first full 12-month period since its breakaway from Bermuda Fire & Marine Insurance.

American International Group began forming two new Bermuda-based insurance subsidiaries. One will act as a catastrophe reinsurance and the other excess casualty business.

Bermuda-based Kloster Cruise Ltd. raise $300 million after a bond issue, enabling the company to take delivery of a new ship, Windward . Timeshare owners association, Members' Advisory Council, are among the bidders for the St. George's club complex.

JUNE The Government buoyantly announced that the recession was over in Bermuda. The upturn in tourism figures, full hotels and encouraging international business and retail sales figures were cited as indicators of a recovering economy, although unemployment was admitted to remain a lingering problem. Opposition leaders warned against over-optimistic claims that the recession was beaten.

Bank of Butterfield president Mr. Michael Collier said: "Bermuda is seeing positive signs of improvement in terms of what is generated by the retail sector.'` However, he added that "if others in Bermuda had pruned back their demands and requirements, the bal ance of payments would have been better''.

Bermuda had been "let off relatively lightly'' by the recession, he said.

Bermuda's reputation as an alternative insurance market to London or New York burgeoned, particularly as nervousness about the future viability of the UK insurance market persisted.

US reinsurer General Re invested in a property catastrophe reinsurer Tempest Re and Goldman Sachs and Johnson & Higgins planned to form a company called Global Capital Re. USF&G Corporation set up property reinsurance company Renaissance Re.

International insurance company EXEL Ltd. reported a profit of $101 million for the second quarter of fiscal 1993 -- an increase of 65 percent.

An extra $1 million was made available to the creditors of Mentor Insurance following a decision by a US federal appeals court that American International Group should reimburse Mentor.

BDR Company, which allows Bermuda residents to invest indirectly in foreign-owned companies while avoiding exchange control restrictions, was listed on the Bermuda Stock Exchange for the first time.

A group of local investors entered a bid for the St. George's Club timeshare complex, bringing the total number of bids to four.