Bermuda reinsurer Validus Holdings Ltd. suffered a net loss of $126.3 million for the third quarter, after taking big hits from hurricanes, investment losses and foreign exchange losses.

The class of 2005 company's first quarterly loss, which broke down to $1.71 per share, compared to last year's third-quarter profit of $136.5 million, or $1.90 per share.

Hurricanes Gustav and Ike, which caused more than $10 billion of industry losses, caused a net negative impact of $185.9 million on Validus.

There were also increases of $37 million in investment losses and an increase in foreign exchange losses of $50.8 million.

But Validus said it had still managed to grow diluted book value per share, plus accumularted dividends, by more than eight percent over the past 12 months. And the company has a positive outlook for next year.

Validus chairman and chief executive officer Ed Noonan said: "As a result of the global financial crisis and large storm losses of the third quarter, we see 2009 as a very strong year for the short tail classes which are Validus' focus.

"The strength of our risk management and flexible global operating platform uniquely position Validus to capitalise on the improving market.

"Despite reporting our first ever quarterly loss, Validus has grown diluted book value per share plus accumulated dividends 8.1 percent over the past 12 months. Our performance versus peer companies continues to be top quartile."

For the first nine months of the year, net income was $16.1 million, or $0.14 per share, compared with $264.0 million, or $4.11 per diluted share, for the corresponding period in 2007.

For the third quarter, net operating loss was $53.1 million, or $0.73 per share, compared with net operating income of $127.9 million, or $1.78 per diluted common share, for the quarter ended September 30, 2007.

Gross premiums written increased by 9.8 percent to $269.2 million from $245.3 million.

The combined ratio of 122.3 percent included $26.1 million of favourable prior-year loss reserve development, benefitting the loss ratio by 7.7 percentage points.

Net realised losses on investments $13.7 million, while Validus also recorded net unrelaised losses of $14.6 million.

Reduced market yields led to a decrease in net investment income to $36.4 million in the July through September period compared to $36.6 million in the same three months last year.