volatility levels in 20 years, reports David Fox . The volatility has hit Bermuda reinsurer Overseas Partners' results.

Record volatility for global equity markets caused more than $122 million in investment losses and a third quarter in the red for Bermuda reinsurer, Overseas Partners Ltd. (OPL).

And although the firm has declared net income of $219.1 million ($1.73 a share) for the first nine months to September 30, that represents a 47 percent decline in the announced income of $415.8 million ($3.17 per share) from the same period a year ago.

Including realised and unrealised investment gains and losses, the unaudited results show the net loss for the third quarter was $39.1 million, a substantial difference from the same period last year which garnered a $130.2-million profit.

President and CEO Bruce Barone explained, "The decreases in net income were primarily due to a dramatic third quarter decline in investment income.

"Global equity markets posted one of their worst quarterly performances with the highest volatility levels in 20 years.

"Losses from investments for the three month period ended September 30, 1998, were $122.3 million compared to a $72.7-million gain for the same period in 1997.

"Our emerging market portfolio suffered losses of $46.1 million for the quarter, while our US equity portfolio and other investments suffered losses of $95.2 million and $21 million, respectively.

"Our overall year-to-date return from investments was $11.8 million, compared to $238.4 million for the nine months ended September 1997.'' OPL did increase net underwriting income by 8.3 percent to $187.1 million over the three quarters, including improving the quarterly figure from $56.5 million in 1997 to $66.9 million for this year's third quarter.

And gross written premium soared nearly 126 percent to $255.5 million for the quarter, a significant portion of which can be attributed to nine new reinsurance programmes that contributed $120 million in premiums written.

Despite the restructuring and cancellation of several large programmes, gross written premiums climbed from $572.6 million for the nine months last year to $684.7 million in this year's corresponding period.

Commenting on the underwriting results, Mr. Barone observed, "Reinsurance markets continue to be soft, with capacity driving underwriting margins down.

"Despite these market conditions, our reinsurance business continued to grow in the third quarter with underwriting activity reflecting a 126 percent increase in gross written premium over the corresponding period in 1997.'' Operating income from real estate and leasing activities increased by $14.8 million to $30.3 million for the nine month period.

Operating income for the quarter improved by $10.8 million, primarily due to the purchase of 200 West Madison Plaza.

Pleased with the latest acquisition, Mr. Barone said, "This 45-storey class A office building will provide our real estate management company, Overseas Management Inc. with increased flexibility in providing rental solutions to our increasing number of class A office tenants in Chicago's central business district.''