Bermuda-based insurer EXEL Ltd., in results released yesterday, reported first quarter net income of $108.1 million, down from year earlier profit of $207.1 million.

Last year's first quarter profit included big realised investment gains -- gains on the sale or disposal of securities.

In 1996's first frame, the company reported a $136.1 million realised investment gains driven by the liquidation of one equity portfolio and two fixed income portfolios. A stronger fixed income market was also a factor.

For the quarter ended February 28, 1997 the company's net realised investment gains were $32.6 million. The decline is reflected in the company's revenues which fell to $217.2 million from $330.2 million.

First quarter unaudited operating income, excluding net realised investment earnings, was $75.5 million compared to $71.0 million for first quarter 1996.

"Our per share results, excluding realised gains, increased 16 percent in the first quarter of 1997 from a year ago reflecting the strong fundamentals of our business and the impact of active capital management, particularly share repurchase,'' EXEL president and CEO Brian O'Hara said.

"Premiums in the first quarter were sharply reduced by the impact of certain specialty reinsurance assumed contracts written a year ago which were cancelled or rewritten,'' he said.

EXEL said the cancellation and reissue of these programmes commenced in the third quarter 1996 and will not impact earnings.

"Competition continues to impact our general liability business but I am pleased to note that all of our other insurance product lines had premiums in the first quarter of 1997. Employment practices liability and XL Risk Solutions, our two newest areas of operation, had strong performance in the quarter.'' EXEL said that assets and shareholders' equity were $5.0 billion and $2.1 billion respectively, both unchanged from three months earlier.

Fully diluted book value at February 28 was $24.72 compared to $24.21 three months earlier reflecting the company's share repurchasing during the quarter.

EXEL also said that quarter gross premiums were $104.4 million compared to $219.1 million in the same quarter in 1996. After adjusting for multi-year premiums and volatility caused by the specialty reinsurance assumed contracts, gross premiums were $141.2 million compared to $150.7 million.

Quarter net premiums written were $77.0 million compared to $163.7 million.

After adjustments, net premiums written were $105.1 million compared to $130.8 million.

Net earned premiums were $119.8 million compared to $130.3 million.

Losses and loss expenses were $85.0 million compared to $104.2 million.

Net investment income was $51.6 million compared to $47.8 million.

EXEL added that it earned $13.2 million in first quarter, compared to $16.1 million a year earlier, from its 25.6 percent stake in Mid Ocean Ltd.

First quarter combined ratio was 88.8 percent compared to 93.6 percent. Loss and loss expense ratios were 70.9 and 80.0 respectively while underwriting ratios were 17.9 and 13.6.