mortgage business have proven unfounded, the company says.

In a quarterly letter to shareholders, Bermuda Home president Mr. Arthur Haycock said just five percent of five percent of total mortgages granted (by Bermuda Home) were to customers who purchased properties through Bermuda Realty.

Bermuda Home was created on June 9, 1994 after the real estate, mortgage and finance divisions of the Bank of Bermuda and L.P. Gutteridge Ltd. were merged.

The merger was called unethical by some as Bermuda Home could ultimately represent the buyer and the seller of real estate.

The low percentage indicates the merger "has certainly not been to the detriment of other realtors'', Mr. Francis Patterson, Chief Financial Officer of Bermuda Home, said in an interview yesterday.

In the letter to shareholders, Mr. Haycock also said: "While the March 31, 1995 year end financial results are still being finalised we are happy to report that preliminary estimates indicate we have had a very satisfactory year with earnings well in excess of initial estimates.

"A high level of mortgage closings in the last quarter, lower than estimated operating expenses and improvement in real estate sales by our subsidiary Bermuda Realty Company Ltd. have all contributed to our success.'' Year end results are expected to be available in mid-June.

Mortgage closings for the year were estimated to have exceeded $60 million.

Bermuda Home's board of directors declared a regular quarterly dividend of 10 cents per common share for the quarter ended March 31, 1995. The company also announced a special year end dividend of 10 cents per share. Both dividends were payable April 13 to shareholders of record March 31.

The company also declared a dividend of 20 cents per share on their eight percent convertible preferred shares payable April 28, 1995 to shareholders of record April 13.

Bermuda Home made a number of adjustments in February to interest rates on fixed term deposits as well as the rate for longer term head start certificates. As of April 1, interest rates on 90 and 180 day open end call deposits accounts was also increased, according to Mr. Haycock.

Over 90 percent of the company's short term assets are placed in a combination of US and Bermuda dollar deposits with banks for periods not exceeding one year. The remainder is invested in Bermuda Government bonds and local corporate equities issued by major companies listed on the Bermuda Stock Exchange (BAS), he continued in the letter to shareholders.

The Bank of Bermuda and LPG each hold 25 percent ownership of Bermuda Home while shareholders hold the remaining 50 percent.