The Bank of Butterfield spent $12.1 million on buying back its shares on the Bermuda Stock Exchange from November to the end of March.

As far as the Bermuda Stock Exchange knows, the sum spent so far marks the largest share repurchase programme ever for local listed companies.

The company announced the launch of a share buy-back programme on November 6.

The programme had been approved by shareholders at the annual general meeting a week earlier. Through March 31, the company bought up 819,852 of its own shares, or four percent of the 20,366,000 shares outstanding as at June 30.

The bulk of the purchases were made during November and December when the stock price ranged between $14.75 and $16.25. When the repurchase plan was approved, the bank's shares were trading at $14.75. Its 52 week high was $19 reached on May 5, an appreciation of about 29 percent during the period. The stock is now trading at $18.50.

According to the company's latest financial report, the bank's earnings per share grew to $1.42 at third quarter ended March 31, compared to $1.08 earnings per share achieved at end of third quarter 1997. Earnings per share increased by 34 percent during that period, while actual earnings from continuing operations increased 32 percent to $28.94 million.

Usually companies buy back their own shares as a means of boosting earnings per share because of the lower number of shares outstanding. When the plan was implemented, Bank of Butterfield chief financial officer Sarath Wikramanayake said the buy-back programme was part of the bank's effort to increase shareholder value. Fewer shares on the market -- since those repurchased are cancelled -- also increases earnings per share and book value per share, all else remaining equal.

Buy-back pays off He also stated the bank had established guidelines on when and how much shares it would repurchase but could not reveal them so as not to tip off the market.

"It is not in the best interest of the shareholders or the bank to talk about these guidelines,'' he said.

Bermuda Home and Bermuda Aviation Services also have share repurchase programmes.

ON THE RISE -- The Bank of Butterfield's share price (in dollars) since the start of its share buy-back programme.