stymied Bermuda-based Centre Re's plans to move into Asian markets -- even though the Bermuda firm is part of the group that was set to take controlling interest in the now insolvent Peregrine Investments.

Centre Reinsurance Holdings Ltd. president David Brown said: "In terms of Centre Re, I think we are still interested in opportunities in Asia and we will still proceed. So it doesn't change my plans.'' Some weeks ago, Mr. Brown said Hong Kong would lead the company's thrust into Asian markets in the short term. Peregrine Investments Holdings Ltd. was planned as the Hong Kong investment bank that would facilitate those efforts.

He said yesterday: "It would have been good to have had that connection in a strategic relationship. But the fact that we don't have that any more won't stop our interest in Asia.'' New York-based Zurich Centre Investments, Inc. (ZCI), the subsidiary of Bermuda-based Zurich Centre Investments Ltd., was on the verge of buying a 24.1 percent stake in Peregrine.

But Peregrine this week was quickly put into liquidation, after the Indonesian markets meltdown helped bring the firm down.

ZCI agreed in November to subscribe for US$200 million worth of 7.5 percent convertible preference shares of US$1,000 each in Peregrine.

The shares were convertible into ordinary shares at HK$8 per share but Peregrine shares slumped since then and were at HK$4.30 before trading was suspended last Wednesday.

Peregrine was unable to reach a deal with ZCI and was forced into default when a funding line of US$60 million was withdrawn on Friday.

The firm was denied assistance by banks and the Hong Kong government after the crucial deal to provide vital funds collapsed last week.

Yesterday, Price Waterhouse was named to liquidate its assets.

"What happened was a complete meltdown in a country,'' a visibly shaken Peregrine chairman and co-founder Philip Tose told a news conference.

"As far as Asia was concerned, Indonesia was regarded as possibly the best candidate to recover from the economic turmoil ...However, clearly Indonesia did disappoint everyone.'' As business prospects faded in Asia, Peregrine reduced its balance sheet to around US$3.2 billion in June, 1997 from US$5.3 billion by selling assets.

Peregrine reported net profit of HK$386.70 million for the ten months to October 31, 1997.

Tose said the drastic depreciation of the Indonesian rupiah was a direct hit on the company's balance sheet at the end of 1997.

"At the end of November, which was our financial year end, the situation was not really markedly changed from that in October. Clearly post financial year-end events had changed that very dramatically indeed,'' said Tose.

"Once Indonesia was downgraded and once the rupiah had halved from 5,000 to 11,000, that would definitely have necessitated our taking a significant write down...and would have put us into loss for the year ended November, not significant but it would have to put us into a loss.

"However, the turmoil that ensued grew greater rather than less,'' said Tose.

"We got caught as a result of the illiquidity. We were unable to get rid of what we've got.

"The position of the group was that it was trading profitably but that we had a very tight funding problem.'' Local newspapers have said one deadly blow was from a loan to an Indonesia taxi and bus company, Steady Safe PT.

"It was an unfortunate transaction but it certainly was not the sole reason for us having the problems that we did,'' said Tose, in answer to a question about the newspaper reports.

"We have a number of other assets on our books that are relatively illiquid -- 70 percent of Kwong Sang Hong, we have a number of direct investments -- but clearly the exposure to the bond book was substantial and did play a role.''