Annuity and Life Re (Holdings) Ltd. says it is continuing to reduce its liabilities.

Annuity and Life Re, Hamilton, Bermuda, is reporting a $212,458 net loss for the second quarter on $169,187 in revenue, compared with a $92,056 net loss on $419,233 in revenue for the second quarter of 2007.

Annuity & Life Re, a life reinsurer that has ceased active marketing of reinsurance, is reporting no revenue from premiums. Investment income accounts for all of its reported revenue.

Thanks in part to the sale of a U.S. operating subsidiary, the company ended the quarter with about $15 million in assets and $809,354 in liabilities, down from $114 million in assets and $88 million in liabilities at the end of 2007.

“As of Dec. 31, 2006, there were no reinsurance agreements in force that generate operating revenue for the company,” the company says in the notes to its latest financial statement. “The company’s only source of revenue is investment income. Due to the absence of ongoing insurance operations, the company has significantly reduced its operations including terminating employees, reducing the size of the board of directors, and moving to smaller office space. Because of statutory requirements, the wind-down or dissolution of the company is not imminent.”

Annuity and Life Re is continuing to “explore strategic alternatives to attempt to maximize its economic value for stockholders,” the company says.