The XL Group board has backed a massive $1 billion share buyback programme, the company announced today.

And the insurance and reinsurance giant will pay a quarterly dividend of 22 cents a share on its common shares at the end of next month, up two cents on the previous payout.

In addition, a dividend of just over $10.47 per share will be paid in April on XLIT Ltd's series D preference ordinary shares and a dividend of $32.50 on its series E preference ordinary shares, also to be paid in April.

The previous share buyback programme, which had around $349 million remaining, has been cancelled.

XL Group said it expected the share purchases to be made on the open market and in privately-negotiated transactions, with the scheme expected to be funded by cash on hand.

A spokeswoman for XL said: “The timing, form and amount of the share buy-backs under the programme will depend on a variety of factors, including market conditions, legal requirements and other factors. The buyback programme may be modified, extended or terminated by the board at any time.”