XL Capital reports narrower 3Q loss

NEW YORK — International insurer XL Capital Ltd. on Wednesday reported a much smaller third-quarter loss compared with a year-ago period in which it booked hefty charges linked to a former bond insurance unit.

For the three months ended Sept. 30, the company lost $11.4 million, or 3 cents per share, versus a loss of $1.6 billion, or $6.04 per share, in the prior quarter.

During the thirdquarter of last year, XL Capital incurred a charge of $1.42 billion tied to former subsidiary Syncora. Bermuda-based XL made payments and issued stock to Syncora as part of a deal to end the companies' reinsurance agreements.

Results for the latest quarter included a one-time charge of $310.8 related to investment losses. Excluding those items, XL earned $306.4 million, or 89 cents per share.

That performance beat Wall Street expectations, which typically do not include one-time charges. On average, analysts polled by Thomson Reuters estimated earnings of 63 cents per share.

Also contributing to the improved results this quarter was an increase of $183.7 million from the company's property and casualty underwriting operations, and fewer payouts on hurricane damages. Book value increased by 26 percent to $23.84 per share at the end of the quarter.

However, the company noted that gross premiums written for the property and casualty operations were 17 percent lower than in the prior-year quarter.

"Although on target with our current guidance for the year, continuing this recovery means we must remain vigilant in the face of challenging pricing conditions," CEO Mike McGavick said in a statement.

Shares of XL Capital were up 87 cents, or 5.2 percent, to $17.10 in after hours trading, after falling 40 cents during the regular session.

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Oct 28, 2009 - 11:07 p.m. EDT

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