Montpelier Re Holdings Ltd. recorded net income of $159 million for the second quarter on low claims and a rise in the value of its investments.

Net income for the April through June period was $159 million, or $1.81 per share, and $211 million, or $2.42 per share, for the first six months of 2009.

Montpelier's operating income was $68.4 million, or $0.76 per share, for the second quarter, compared to $63.3 million in the same period last year.

For the half-year period, operating income was $115.5 million, or $1.31 per share, compared to $91.5 million in the same period last year.

Realised and unrealised gains on investments and foreign exchange, which are included in net income, were $91 million for the second quarter and $89 million year-to-date.

Fully converted book value per share was $18.12 at June 30, 2009, an increase of 11.1 percent for the quarter and 14.6 percent from December 31, 2008, inclusive of dividends. The company did not repurchase any shares or debt during the 2009 second quarter.

The combined ratio - the percentage of premium dollars spent on expenses and claims - was 61.5 percent for the 2009 second quarter and 67.6 percent for the first six months of 2009. The second quarter 2009 loss ratio totalled 23.6 percent, which includes 12 points ($17 million) in favourable releases from prior years' loss reserves. "We produced an excellent quarterly result with a low loss ratio and solid investment results leading to 11.1 percent growth in our fully converted book value per share," said Chris Harris, President and chief executive officer.

"Our strong capital position also enabled us to grow net written premiums by 19 percent."

"Market conditions are healthy in most of our key lines, and we continue to pursue opportunities to further leverage our franchise as witnessed by the recent addition of a marine underwriting team to our Lloyd's syndicate."