in investment income moved domestic insurer BF&M's half year profit to June 30 up nine percent.

Net earnings for the period were buoyant at $5,330,042 and earnings per share rose to $1.31, as total income increased 12 percent to nearly $27.3 million.

President and CEO Glenn M. Titterton reported in a letter to shareholders continued progress for the group as a whole and the underlying success of each operating subsidiary.

"Our customers,'' he said, "whether businesses or individuals, are affected by Bermuda's uncertain economic recovery.'' BF&M reports `considerable success' "During the first half of the year there were modest signs of improvement in some sectors but the performance of our tourism industry was disappointing.

"This affects the entire community and we share the consequences with our policyholders. Despite this, we are able to report considerable success during this period.'' Gross premiums earned rose to nearly $28.7 million. With reinsurance ceded of nearly $9.9 million, net premiums earned were nearly $18.8 million.

Investment income exceeded $4.1 million, while commissions and other income were put at more than $4.3 million.

Mr. Titterton concluded, "Our results for the first half of 1996 are very pleasing. The period was characterised by increased competition in a softer and rapidly changing market.'' A 15 percent or more than $2 million increase in claims, benefits and claim expenses pushed total expenses up by nearly $2.5 million (13 percent) to more than $21.9 million. Claims, benefits and claim expenses alone were nearly $15.3 million.

Excluding segregated and managed funds, total assets increased to $138,403,699. Shareholders' equity improved to $52,971,977.

Shareholders received dividends during the period totaling $1,768,408, which included $643,408 paid on common shares at ten cents a share per quarter, together with $1,125,000 paid on preference shares at 22.5 cents per share per quarter.

Trading of common shares remain suspended on the Bermuda Stock Exchange, pending the resolution of legal claims against certain common shareholders.

Mr. Titterton said that BF&M General Insurance Company Limited again produced very good results, even in the difficult market, maintaining a strong market position across the broad range of property, casualty, motor and marine business.

Rapid increases in property premiums in recent years stabilised last year, although some premiums have softened somewhat for some large commercial risks.

Loss experience in the motor and marine accounts was described as "less than satisfactory'' but overall claims experience was said to be better than the comparable period last year.