Determined to regain lost ground, president and CEO of XL Capital Ltd. Brian O'Hara has said the company will turn down business if and where pricing remains soft.

Mr. O'Hara made the statement shortly after announcing last Friday a major re-organisation of XL which included the axing of 120 jobs worldwide.

The redundancies were the first ever for the 15-year-old company but were made to increase flagging profits and keep shareholders happy.

At a panel discussion on the future of reinsurance held the same day, Mr.

O'Hara said he felt prices would improve and become more realistic.

"My opinion is that there is going to be a tightening in the market particularly in the treaty reinsurance market and I think we're going to see a withdrawal of some magnitude,'' he said.

"I don't think we want to see a real dramatic change. We'd like to see an improvement to profitability but there is no question that almost throughout the industry we have been underpricing our product.

"I would rather see a turn that takes place over a two to three-year period that is sustainable in putting the fundamentals back in order,'' he continued.

"I know that we will not be offering anything unless we see improvements to our rates. In fact we will withdraw from the business if necessary.''