subsidiary's takeover of the policy liabilities of the Bermuda branch of Confederation Life Insurance Company.

Registrar of Companies, Mr. Kymn Astwood, said that a new company, Citicorp subsidiary, Citicorp International Insurance Company, was incorporated in Bermuda to buy the Bermuda branch portfolio.

He said, "I am satisfied that this arrangement is in the best interests of all. It signals a very good end to a messy situation for the Bermuda policy holders. It eliminates a large degree of uncertainty relating to this Confederation Life liquidation.

"We have certain responsibilities in Bermuda and there are also some ramifications in Canada, so both jurisdictions have to sign off on the deal. I was aware of the negotiated arrangement from the very start.'' The former principle representative for the company in Bermuda, Coopers & Lybrand partner, Mr. David Lines, agreed that the deal was welcomed.

Mr. Lines, senior partner at Cooper & Lines-Coopers & Lybrand, said, "It's a good solution, good for the policyholders. I am delighted to see that this has come about.'' The portfolio is comprised of 170 life policies, with annual premium income of about $3.2 million.

Peat Marwick Thorne Inc. (PMTI), acting as agent for the Superintendant of Financial Institutions, the provisional liquidator of Confederation Life, has entered into an agreement to transfer the policy liabilities. Bloomberg has reported that the deal is supposed to close next month.

Last March, former Registrar of Companies, Mr. Malcolm Butterfield, who was the Receiver and provisional liquidator of the Bermuda branch of the troubled company, agreed that the most beneficial course of action for the policyholders was for the assets to be transferred to the Canadian liquidator.

Mr. Astwood said yesterday, "The reason why the administration of the liquidation was transferred to Canada, was because we felt that the policyholders would be better off under the Canadian liquidation. There were more assets in the total entity than in this small branch. Once that happened, we were still kept informed.'' Confederation Life, Canada's fourth largest insurer was seized a year ago by Canadian regulators after a proposed CAD$600 million bailout by a group of Canadian insurers failed to materialise. It was regarded as one of the biggest insurance failures ever in North America.

Mr. Astwood said, "Even though the old Confederation Life had a permit to do business here, it is not a requirement under our law to actually keep the assets in Bermuda.

"Essentially the title is transferring to a Bermuda company. That's the key thing. The assets could be anywhere around the world, but the title is in the Citicorp company now. That's all part of that deal to transfer the assets and liabilities to this entity.'' The local Confederation office wrote policies for South American clients and its presence here was relatively small, with no local policyholders.