Bermuda-based re/insurer Alterra Capital Holdings Ltd. last night posted net income of $82.8 million for the third quarter.

Alterra, formerly known as Max Capital Group Ltd., was formed on May 12, 2010 by the merger of Max and Harbor Point Limited, a privately held reinsurer.

Gross written premiums of $323.9 million rose $58 million, or 21 percent, from the results achieved by Max last year.

The net earnings broke down to 70 cents per share for the third quarter, compared to Max's net income of $95.3 million, or $1.64 per share, in the same period last year.

Alterra chief executive officer Marston (Marty) Becker said: "Alterra had a very solid quarter financially, and also operationally, with the Harbor Point merger integration proceeding as planned and now largely completed. "Our balance sheet is very strong, and we are well positioned to respond to market opportunities as they arise.

"Our gross premiums written during the quarter were down on a pro forma basis, due in part to Alterra's continued underwriting discipline in the face of a softening market, and to a related trend among primary companies to retain a greater share of business. "Coupled with declining yields on invested assets, these factors added pressure to current operating income. "We are pleased with the early results of our expansion into Latin America and the continued strong performance of our late 2008 Lloyd's acquisition. Taken together with the quality underwriting teams that joined us as a result of our recent merger, we are strongly positioned both for today and for the future, with proven insurance and reinsurance capabilities in Bermuda, Dublin, London, and the US — and now Latin America reinsurance as well." Mr. Becker added that during the quarter Alterra had continued its share repurchase programme, buying back shares at an attractive discount to book value. "For the year to date, we have returned over $435 million to shareholders in the form of dividends and share repurchases," he said.

"We have also increased our capital flexibility this quarter by issuing long term debt at a favourable fixed rate of interest, reducing our allocation to short term variable rate borrowing.

"We believe this will prove beneficial in the future as interest rates inevitably rise from their current levels." Property and casualty combined ratio was 86.0 percent in the third quarter compared to 90.9 percent in the same quarter of 2009, with property catastrophe event and significant per-risk net losses of $14.1 million.

Net investment income totalled $161.4 million compared to $125.1 million in the same period of 2009, an increase of 29 percent. Net operating income was $175.5 million, or $1.97 per diluted share, representing an annualised net operating return on average shareholders' equity of 10.2 percent.

Shareholders' equity was $3.04 billion as of September 30, 2010, an increase of 3.7 percent during the quarter. Book value per diluted share at the end of the quarter was $25.88, an increase of 5.4 percent from June 30.