Bermuda-based RenaissanceRe Holdings Ltd. has decided it's better off sticking with its core catastrophe reinsurance business on the Island.

The company yesterday announced it was putting the business units of its US-based subsidiary Nobel Insurance Co. up for sale seven months after buying the company for $63 million.

RenaissanceRe is taking a $40 million charge in the fourth-quarter from Nobel, made up of after-tax losses of $30 million of adverse development on its surety and casualty reserves, $5 million for a goodwill write down, and $5 million in other charges.

The charge will result in the company reporting a loss in the fourth quarter, RenaissanceRe Holdings chairman, president and chief executive officer James Stanard stated in a press release.

He also announced Keith Hynes, who was in charge of the Nobel operations, would be leaving the company on March 31. Mr. Hynes was executive vice president of primary operations at RenaissanceRe, and headed Renaissance US Holdings, Inc.

The company declined to provide further information regarding the reason Mr.

Hynes is leaving the company. Mr. Hynes did not return a telephone call.

Renaissance US included subsidiaries Glencoe Insurance Ltd. and DeSoto Insurance. In total Glencoe, DeSoto, and Nobel have about 300 employees in the US.

"We are obviously very disappointed that the promise we saw in Nobel has not been fulfilled,'' Mr. Stanard stated. "Faced with deteriorating claim experience and the need to advance additional capital to support ongoing business development, we concluded that our shareholders would fare better with reinvestment in our core reinsurance business. Our catastrophe reinsurance business continues to produce market-leading results, and our other primary operations, DeSoto and Glencoe, are performing according to plan.'' Nobel is an insurer of low-cost homes and is a casualty underwriter for the explosives, specialty commercial trucking, propane, personal lines and surety bonds industries. For the first quarter of 1998 Nobel had a net loss of $590,000, a fall of 148 percent from the $1.21 million profit the company recorded in first quarter 1997.

Nobel was part of what RenaissanceRe was calling its "focused diversification'' strategy into the primary market, in contrast to the large buyouts and expansions of other Bermuda-based companies.

At the time it was bought RenaissanceRe executives said Nobel was attractive as an acquisition because it had been a reinsurance client for three or four years. Nobel was also attractive because it wrote business for low value dwelling homeowners insurance in the US southeast, but did not write business in Florida, DeSoto's domain.

In an interview RenaissanceRe chief financial officer John Lummis said the losses mainly came from the company's casualty business in the trucking industry and from the surety business.

He said RenaissanceRe was in contact with "some interested parties'' who wanted to take over the business units.

After the sale RenaissanceRe US operations will consist of Bermuda-registered Glencoe, which the company created in 1996 to write commercial, catastrophe-exposed property business. In 1997 the company incorporated DeSoto Insurance Co. to write homeowners insurance in Florida. DeSoto began writing business in 1998.

"We remain committed to those businesses,'' Mr. Lummis said.

For the nine months to September 30, 1998 RenaissanceRe reported net operating income of $91.3 million, compared to $106.9 million in the same period of 1997.

Property catastrophe coverage through Renaissance Reinsurance Ltd. accounted for 91 percent of the company's gross premiums. The company reported a loss of $4.9 million from Nobel in the third quarter.

Mr. Lummis said the company will "continue to seek out new business opportunities'' in the year ahead.

The company recently announced it was forming a new reinsurer in a joint venture with US-based State Farm Ltd. to cover large property catastrophe risks with limits of up to $500 million.

The joint venture, to be called Top Layer Reinsurance, will be based in Bermuda and will have a total capacity of up to $3 billion. In December the company announced the creation of Renaissance Reinsurance of Europe.

The company's share price has fallen from a high of $47.625 in August 1998 to the current low of $34.75, a drop of about 27 percent in price.

JAMES STANARD -- Nobel no longer seen as prize.