its ultimate parent company, the Asea Brown Boveri Group, has authorised a $50 million increase of its paid-up capital.

The $50 million increase, effective December 31, 1992, will come through the issue of preferred capital stock fully subscribed by Scandinavian Re's immediate parent, Sirius International, of Sweden.

At year end 1991, Scandinavian Re's capital and surplus stood at $61.5 million, split between $25 million in paid up capital, $25 million of contributed surplus, and the balance comprised of retained earnings and unrealised capital gains on equities.

At year end 1992, capital and surplus would exceed $100 million, said Ms Peggy Bruzelius, chairwoman of Scandinavian Re's board.

Mr. Jens Juul, president and CEO of Scandinavian Re, said that the magnitude of equity was becoming significantly more important as a competitive factor, even for a specialist finite risk carrier.

The boost in equity now effectively separates Scandinavian Re from a number of less well capitalised competitors, said Mr. Juul.

He added: "The major benefit of this equity increase lies in enhanced credibility and security.

"The increase does not mean that we are going to double our volume overnight, nor that we are going to dramatically change our risk exposures.

"Our ability to provide tailor-made, innovative solutions has become known and respected in the four years since our formation and our marketability should now be substantially enhanced with a capital and surplus in excess of $100 million, especially in the US.'' Mr. Dave Brining, Scandinavian Re's vice president and CFO, said the unleveraged Balance Sheet of the firm should provide "great comfort to producing brokers and clients in these turbulent times''.

He added: "At year end 1992, our premium income will be approximately one-third of our capital and surplus, which in turn will be one quarter of total assets, both remarkable ratios as compared to our competitors and the industry as a whole.'' Scandinavian Re is a wholly owned subsidiary of Sirius International and part of the ABB group, the world's leading electrical engineering group with annual sales of $29 billion and over 210,000 employees worldwide.

The capital increase is Scandinavian Re's second since it was formed in October, 1988, with capital of $25 million.

Since inception, $19 million has been dividended back to its parent company.