Giant Swiss-based insurance and financial services company, The Zurich Group is developing a Zurich Group Financial Service Centre in Bermuda.

The centre, for the first time, will unite several key entities of the group in one location here, the just released annual report of Zurich International (Bermuda) Ltd. (ZIB) states.

Those entities will include ZIB and the newly-formed Zurich Insurance Co.

Bermuda Branch (ZIBB).

It will also facilitate the transfer of Zurich Group reinsurance business to ZIB and ZIBB in the future.

The new centre will increase the group's capacity to provide financial engineering and capital management services in Bermuda.

ZIB markets direct life business and direct non-life business from offices at Cedar Avenue, Hamilton.

Incorporated in Bermuda in 1977, it has provided structured insurance products, captive management and rent-a-captive facilities to its clients.

The report details the successful year of the company, as its relationship with other companies in the Zurich Group continued to grow.

President and CEO Markus Rohrbasser said the firm developed a number of new strategies to support the risk management objectives of clients, and laid the groundwork for new relationships with insurers outside the group.

But he said, "One of our most productive relationships in 1977 was with Global Energy, a worldwide specialties unit within the Zurich Group.

"Gross premiums written for this unit during the year totalled $74.3 million.

Our affiliation with Global Energy has helped to increase our total assets to almost $1.5 billion.'' The company declared a net profit for the year to December 31 of $17.9 million, a substantial improvement over the $858,000 in 1996 and $6.7 million in 1995. Net investment income rose 200 percent from $11 million to $33 million.

The upturn in profit came despite plunging gross premiums written, which fell by $186.5 million to $148.9 million.

The anticipated decline was partly due to an $84.4 million reduction in written premiums involving Zurich Global Energy business.

It related to $29.3 million of premiums tied to a one-time portfolio transfer in 1996 and $55.1 million resulting primarily from premiums assumed by ZIB in 1996 being transferred to another Zurich Group entity in 1997.

In addition, the sale of one business unit by the Zurich Group resulted in a decline of $87 million in premiums written.

Mr. Rohrbasser said, "In recent years, ZIB has become increasingly involved in investment activities, even as we have continued to expand our insurance and reinsurance businesses.

"We now manage numerous Zurich Group holding companies and insurance companies.

"In the future, we plan to provide management services to an increasing number of companies both within and outside the Zurich Group.'' During the year, the company also continued to renew multi-year business and provide a variety of risk management services to other Zurich Group companies and clients.

ZIB worked closely with Bermuda-based Zurich affiliate, Centre Solutions, to provide finite risk solutions for clients. The two firms pioneered the finite risk concept together some ten years ago.

ZIB continued its profitable relationship with Zurich Centre Group Holdings Ltd. (formerly Zurich Centre Investments Ltd.), maintaining its 35.3 percent equity stake.

ZIB's equity income from its holding in the company increased to $29.9 million for the year, up from $6.2 million in 1996.

The Zurich Group, which celebrated its 125th anniversary last year, is a leading, internationally recognised provider of insurance and financial services in non-life and life insurance, reinsurance, and asset management. It operates in 50 countries, employing more than 43,500 people.