operating income and sterling investment results helped push Bermuda-based insurer EXEL Ltd. to record end-of-year profits of $677 million or $7.84 per share.

Net income for the year to November 30 was 37 percent better than the year before.

Net operating income rose 26 percent to $341 million and net investment income rose from $198.6 million in the 1996 year to $216.6 million last year.

EXEL president and CEO, Brian M. O'Hara said, "These are record results, both on an operating and net income basis.

"Our very strong earnings are the result of maintaining the company's underwriting discipline in an increasingly competitive insurance market, as well as unprecedented gains in our investment portfolios.

"Our underwriters continue to deal effectively with an increasingly competitive market and are repositioning our core insurance book to improve risk profile.

"Our diversification efforts and new product initiatives are providing additional sources of revenue and income for us.'' Gross premiums written for 1997 were $441.3 million, compared with $729.4 million in 1996. After adjusting for premiums relating to multi-year contracts and reinstatement premiums, gross premiums written were $552.8 million, compared with $565.4 million in 1996.

Net written premiums were $316.6 million for the year, down from $597 million the year before. Net written premiums were reduced by $33.8 million for the fourth quarter, and for the year, as a result of the purchase of an excess of loss reinsurance policy covering all general liability risks.

Net earned premiums were $540.7 million, up from $517.9 million in 1996.

After adjusting for premiums ceded under the general liability reinsurance quota share treaty, reinstatement premiums and triplicat policies, net earned premiums in the fourth quarter and full year 1997 were $145.2 million (Quarter four, 1996: $124.3 million) and $540.2 million (1996: $496.9 million), respectively.

Net investment income was $216.6 million (1996: $198.6 million). Realised investment gains were $335.9 million (1996: $206.2 million). Total revenues for the year rose 18 percent to $1.2 billion. Total assets at November 30 were $6.1 billion, or $1.1 billion higher than the $5 billion a year before.

Shareholders' equity at year end was $2.5 billion, up from $2.1 billion a year before. Fully diluted book value per share was $29.33, up from $24.21 on the comparative date.

EXEL earned $65.9 million for the year from its equity in the net earnings of its affiliates, up from $59.2 million in 1996.

The combined ratio for the year was 85.8 percent, (1996: 93.6 percent). The loss ratio improved from 78.3 percent to 67.6 percent, as the underwriting expense ratio slipped from 15.3 percent to 18.2 percent.

EXEL cheers record profits EXEL repurchased 3.4 million of its shares for $140.3 million and currently has authorisation to repurchase an additional 2.4 million shares.

For the fourth quarter, net income rose nearly 13 percent to $150.7 million, operating income rose almost 20 percent to $90.1 million and total revenues increased 13 percent to $289.1 million.

Also in the final frame, gross premiums written were down from $160.7 million to $121.2 million. After adjusting for premiums relating to multi-year contracts and reinstatement premiums, they dropped from $134.2 million to $120 million.

Net written premiums for the last quarter were cut in half from $136.9 million to $65.9 million, while net earned premiums increased from $131.1 million to $153 million.

The combined ratio for the fourth quarter was 86 percent, comprising a loss and loss expense ratio of 68 percent, and an underwriting expense ratio of 18 percent.

Through XL Insurance Co., Ltd., XL Europe Insurance and XL Global Reinsurance Co., Ltd., EXEL Ltd. is a leading provider of general liability, D&O liability, employment practices and professional liability, political risk, risk solutions, excess property insurance and reinsurance coverages to industrial, commercial and professional service firms, insurance companies and other enterprises on a worldwide basis.

"Our diversification efforts and new product initiatives are providing additional sources of revenue and income for us.'' -- Brian O'Hara (above)