NU Online News Service, Aug. 15, 2003, 11:37 a.m. EDT – The downsizing of Annuity and Life Re (Holdings) Ltd., Hamilton, Bermuda, “is essentially complete,” says Jay Burke, the company’s chief executive.

“After repositioning the investment portfolio through the second half of 2003, we expect to see a small profit in 2004,” Burke says.

Annuity & Life Re is reporting a $69 million net loss for the second quarter on $70 million in revenue, compared with a $20 million net loss on $120 million in revenue for the second quarter of 2002.

The struggling reinsurer cut 40% of its staff this spring.

But the company also tried to attack the worst drains on earnings, by terminating one large, unprofitable contract that guaranteed minimum annuity death benefits, and starting or completing efforts to recapture and terminate several other unprofitable life and annuity reinsurance agreements.

The company also is trying to end its reinsurance relationships with its neighbor, XL Life Ltd., Hamilton.

The recaptures and terminations generated about $55 million, but they should help Annuity & Life Re improve its performance, the company says.