Greenlight Re Announces Second Quarter 2009 Financial Results

GRAND CAYMAN, Cayman Islands, Aug. 3, 2009 (GLOBE NEWSWIRE) -- Greenlight Capital Re, Ltd. (Nasdaq:GLRE) today announced financial results for the second quarter of 2009. Greenlight Re reported net income of $92.2 million for the second quarter of 2009 compared to net income of $33.5 million for the same period in 2008. The net income per share on a fully diluted basis was $2.51 for the second quarter of 2009, compared to net income per share of $0.91 for the same period in 2008.

Fully diluted book value per share was $16.73 as of June 30, 2009, a 4.3% decrease from $17.49 per share as of June 30, 2008.

For the six months ended June 30, 2009, net income was $120.0 million compared to $28.8 million for the same period in 2008. On a fully diluted basis, net income per share was $3.29 for the six months ended June 30, 2009 compared to $0.78 for the same period in 2008.

"In the second quarter of 2009 our underwriting portfolio continued its profitable growth while our investment portfolio posted a good return in light of our conservative portfolio positioning," said David Einhorn, Chairman of the Board of Directors of Greenlight Re. "While the insurance market has not hardened as quickly as we had hoped, our team continues to identify and select attractive underwriting opportunities while retaining our existing portfolio. We expect continued uncertainty in the economy, and believe we are uniquely positioned to take advantage of opportunities and dislocations in the market."

Greenlight Re's financial and operating highlights for the second quarter and six months ended June 30, 2009 include the following:

 * Gross written premiums in the second quarter of 2009 were
   $70.0 million compared to $25.4 million in the second quarter of
   2008, while net earned premiums were $49.3 million compared to
   $24.7 million, respectively.  For the first six months of 2009,
   gross premiums written were $141.9 million compared to
   $96.1 million for the first six months of 2008, while net earned
   premiums were $95.5 million compared to $52.2 million, respectively.
 * The combined ratio for the six months ended June 30, 2009 was 96.7%
   compared to 92.5% for the six months ended June 30, 2008.
 * Net investment income in the second quarter was $88.3 million, a
   return of 13.9% on our investment portfolio. This compares to
   $31.0 million in the second quarter of 2008, when we reported a
   4.5% return on our investment portfolio. For the first six months
   of 2009, net investment income was $116.0 million compared to
   $25.3 million during the comparable period in 2008.

"We continued to successfully build our underwriting portfolio and leverage our strategic partnerships while also benefiting from the reversal of the catastrophe loss we booked in the first quarter of 2009. Our growing team of reinsurance professionals continue to find new and differentiated ways to penetrate the market to find what we believe will be profitable opportunities," said Len Goldberg, Chief Executive Officer of Greenlight Re. "While our investment portfolio has been conservatively positioned given the potential volatility in the markets, we were able to demonstrate significant outperformance in the second quarter of 2009. Our second quarter results underline our strategy to earn strong risk-adjusted returns on both sides of the balance sheet in order to drive long-term growth in book value per share."

Conference Call Details

Greenlight Re will hold a live conference call to discuss its financial results for the second quarter of 2009 on Tuesday, August 4, 2009 at 9:00 a.m. Eastern time. The conference call title is Greenlight Capital Re, Ltd. Second Quarter 2009 Earnings Call.

To participate, please dial in to the conference call at:

 U.S. toll free               1-800-860-2442
 International                1-412-858-4600

 The conference call can also be accessed via webcast at:

    http://www.talkpoint.com/viewer/starthere.asp?Pres=127399

A telephone replay of the call will be available from 11:00 a.m. Eastern time on August 4, 2009 until 9:00 a.m. Eastern time on August 19, 2009. The replay of the call may be accessed by dialing 1-877-344-7529 (U.S. toll free) or 1-412-317-0088 (international), access code 432752. An audio file of the call will also be available on the Company's website.

Regulation G

Fully diluted book value per share is a non-GAAP measure and represents basic book value per share combined with the impact from dilution of share based compensation including in-the-money stock options as of any period end. We believe that long term growth in fully diluted book value per share is the most relevant measure of our financial performance. In addition, fully diluted book value per share may be of benefit to our investors, shareholders and other interested parties to form a basis of comparison with other companies within the reinsurance industry.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the U.S. Federal securities laws. These statements involve risks and uncertainties that could cause actual results to differ materially from those contained in forward-looking statements made on behalf of the Company. These risks and uncertainties include the impact of general economic conditions and conditions affecting the insurance and reinsurance industry, the adequacy of our reserves, our ability to assess underwriting risk, trends in rates for property and casualty insurance and reinsurance, competition, investment market fluctuations, trends in insured and paid losses, catastrophes, regulatory and legal uncertainties and other factors described in our annual report on Form 10-K filed with the Securities Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Greenlight Capital Re, Ltd.

Greenlight Re (www.greenlightre.ky) is a specialist property and casualty reinsurance company based in the Cayman Islands. The Company provides a variety of custom-tailored reinsurance solutions to the insurance, risk retention group, captive and financial marketplaces. Established in 2004, Greenlight Re selectively offers customized reinsurance solutions in markets where capacity and alternatives are limited. With a focus on deriving superior returns from both sides of the balance sheet, Greenlight Re's assets are managed according to a value-oriented investment strategy that complements the Company's business goal of long-term growth in book value per share.

The Greenlight Capital Re logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5571

                         GREENLIGHT CAPITAL RE, LTD.
                   CONDENSED CONSOLIDATED BALANCE SHEETS

                    June 30, 2009 and December 31, 2008
                  (expressed in thousands of U.S. dollars,
                     except per share and share amounts)

                                                June 30,
                                                 2009      December 31,
                                              (unaudited)      2008
                                              -----------  -----------
 Assets
 Investments in securities
 Debt instruments, trading, at fair value     $   134,347  $    70,214
 Equity securities, trading, at fair value        401,139      409,329
 Other investments, at fair value                  60,144       14,423
                                              -----------  -----------
 Total investments in securities                  595,630      493,966
 Cash and cash equivalents                        133,472       94,144
 Restricted cash and cash equivalents             387,172      248,330
 Financial contracts receivable, at fair value     19,156       21,419
 Reinsurance balances receivable                  105,727       59,573
 Loss and loss adjustment expense recoverables      6,880       11,662
 Deferred acquisition costs, net                   34,117       17,629
 Unearned premiums ceded                            9,813        7,367
 Notes receivable                                  16,952        1,769
 Other assets                                       3,797        2,146
                                              -----------  -----------
 Total assets                                 $ 1,312,716  $   958,005
                                              ===========  ===========
 Liabilities and shareholders' equity
 Liabilities
 Securities sold, not yet purchased,
  at fair value                               $   369,293  $   234,301
 Financial contracts payable, at fair value        12,966       17,140
 Loss and loss adjustment expense reserves        115,534       81,425
 Unearned premium reserves                        129,920       88,926
 Reinsurance balances payable                      45,097       34,963
 Funds withheld                                     2,936        3,581
 Other liabilities                                  9,726        6,229
 Performance compensation payable
  to related party                                 12,698           --
                                              -----------  -----------
 Total liabilities                                698,170      466,565
                                              -----------  -----------
 Shareholders' equity
 Preferred share capital (par value $0.10;
  authorized, 50,000,000; none issued)                 --           --
 Ordinary share capital (Class A: par value
  $0.10; authorized, 100,000,000; issued and
  outstanding, 30,021,393 (2008: 29,781,736);
  Class B: par value $0.10; authorized,
  25,000,000; issued and outstanding,
  6,254,949 (2008: 6,254,949))                      3,628        3,604
 Additional paid-in capital                       479,311      477,571
 Non-controlling interest in joint venture          7,395        6,058
 Retained earnings                                124,212        4,207
                                              -----------  -----------
 Total shareholders' equity                       614,546      491,440
                                              -----------  -----------
 Total liabilities and shareholders' equity   $ 1,312,716  $   958,005
                                              ===========  ===========


                      GREENLIGHT CAPITAL RE, LTD.
              CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                              (UNAUDITED)

     For the three and six months ended June 30, 2009 and 2008
              (expressed in thousands of U.S. dollars,
                 except per share and share amounts)

                       Three months ended         Six months ended
                             June 30,                 June 30,
                    ------------------------  ------------------------
                       2009         2008          2009        2008
                    -----------  -----------  -----------  -----------
 Revenues
  Gross premiums
   written          $    70,047  $    25,360  $   141,918  $    96,126
  Gross premiums
   ceded                 (6,611)      (5,615)      (7,831)     (14,887)
                    -----------  -----------  -----------  -----------
  Net premiums
   written               63,436       19,745      134,087       81,239
  Change in net
   unearned premium
   reserves             (14,089)       4,937      (38,547)     (29,065)
                    -----------  -----------  -----------  -----------
  Net premiums
   earned                49,347       24,682       95,540       52,174
  Net investment
   income                88,323       31,025      116,040       25,263
 Other income
  (expense)                 (70)          --        2,054           --
                    -----------  -----------  -----------  -----------
  Total revenues        137,600       55,707      213,634       77,437
                    -----------  -----------  -----------  -----------
  Expenses
  Loss and loss
   adjustment
   expenses
   incurred, net         23,547        9,337       53,743       21,461
  Acquisition costs,
   net                   15,578        9,228       28,823       19,157
  General and
   administrative
   expenses               5,330        3,210        9,708        7,670
                    -----------  -----------  -----------  -----------
  Total expenses         44,455       21,775       92,274       48,288
                    -----------  -----------  -----------  -----------
  Net income before
   non-controlling
   interest and
   corporate income
   tax expense           93,145       33,932      121,360       29,149

  Non-controlling
   interest in
   income of joint
   venture               (1,006)        (394)      (1,337)        (361)
                    -----------  -----------  -----------  -----------
  Net income before
   corporate income
   tax expense           92,139       33,538      120,023       28,788
  Corporate income
   tax benefit
   (expense)                 57           --          (18)          --
                    -----------  -----------  -----------  -----------
  Net income        $    92,196  $    33,538  $   120,005  $    28,788
                    ===========  ===========  ===========  ===========
  Earnings per share
  Basic             $      2.54  $      0.93  $      3.32  $      0.80
  Diluted           $      2.51  $      0.91  $      3.29  $      0.78
  Weighted average
   number of
   ordinary shares
   used in the
   determination of
  Basic              36,252,925   36,249,979   36,160,160   36,181,761
  Diluted            36,689,711   36,841,029   36,503,890   36,771,949

Due to the opportunistic and customized nature of our underwriting operations, we expect to report different loss and expense ratios in both our frequency and severity businesses from period to period. The following table provides the ratios for the six months ended June 30, 2009 and 2008:

                       Six months ended           Six months ended
                         June 30, 2009              June 30, 2008
                  -------------------------  -------------------------
                 Frequency Severity  Total  Frequency Severity  Total
                  -------  -------  -------  -------  -------  -------
 Loss ratio         58.2%    50.8%    56.3%    42.3%    39.0%    41.1%
 Acquisition cost
  ratio             39.4%     4.7%    30.2%    49.7%    13.9%    36.7%
                  -------  -------  -------  -------  -------  -------
 Composite ratio    97.6%    55.5%    86.5%    92.0%    52.9%    77.8%

 Internal expense
  ratio                               10.2%                      14.7%
                                    -------                    -------
 Combined ratio                       96.7%                      92.5%
                                    =======                    =======

CONTACT: Stanton Public Relations & Marketing
         Alex Stanton
         (212) 780-0701
         astanton@stantonprm.com