$67.7 million last year to $3.2 million for local catastrophe reinsurance company IPC Holdings Ltd.

In what the chairman described as the company's most difficult year since its formation, net income per common share fell from $2.71 in 1998 to just 13 cents for the year end December 31, 1999. In 1997 this figure stood at $4.01.

Chairman Joseph Johnson and president and chief executive officer John Dowling said in a letter to shareholders in their annual report that: "`Our results for 1999 reflect another very difficult year in which poor pricing conditions prevailed in the various insurance markets around the world.'' The amount of written premiums has not fallen correspondingly. In 1998 it stood at $111.2 million, but fell to $97.2 for 1999.

Not all was doom and gloom as the two managers said they thought there were signs of a turn around in the market.

The report said: "However, with a high accumulation of catastrophe losses, rates in the property catastrophe business began to show some signs of improvement which gives us hope that the market is beginning to turn.'' The report said that the company retained its capital strength at a level at which they believe is necessary to compete effectively.

The company's A plus ratings form A.M. Best and Standard & Poors' were also reaffirmed during 1999.

"The need to preserve capital, together with pressure on earnings caused by some exceptional losses, resulted in lower dividends being paid during the year.'' In the fourth quarter the board of directors decided not to declare a dividend for shareholders.

"Your board of directors is resolved to maintain dividend payments at a level which it believes is appropriate to the earnings and capital requirements of the company, even if it results in no dividends being paid.'' The report said that the continuing consolidation activity among their brokers and clients has resulted in a re-examination of marketing strategy.

This led to closing the London office at the end of January 2000 because its existence was "no longer justified''.

But despite the disastrous year, the company said it was hopeful about the future.

"The insurance business is cyclical and we believe the we are positioned to take advantage of any improvement in market conditions that may occur. In the mean time, we will maintain our disciplined approach in selecting business which we believe is likely to produce superior long-term results. As we emerge from the most difficult year since our formation, we would like to thank all of the staff for their hard work and dedication during 1999.'' CHART