Lloyd's posts a £1.1bn profit

LLOYD'S of London unveiled record profits of nearly £1

LLOYD'S of London unveiled record profits of nearly £1.1 billion sterling yesterday, returning to the black in spectacular style after five years of heavy losses.

The result was influenced by much higher rates, combined with fewer major catastrophes, and represented a return of over 13 per cent on written premiums.

The insurance market's chairman, Mr David Rowland, said the 1993 pure profit of £1.084 billion was one of the best trading results in Lloyd's 308 year history. Lloyd's reports three years in arrears to allow time to process claims.

Analysts jumped on the profit prediction for the 1995 year, which, at £882 million, was significantly bigger than expected. Some were not expecting Lloyd's to make a 1995 forecast at all.

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The return to profit after five years of losses, which totalled more than £8 billion and threatened the market's future, is a significant boost for Lloyd's.

Mr Rowland is trying to win significant majority support among the market's 34,000 investors worldwide for proposals to reinsure past losses into a new company called Equitas.

They are due to vote on a recovery plan at Lloyd's annual meeting on Monday and Lloyd's needs their backing at this and subsequent votes held by action groups representing investors if it is to pass a solvency test at the end of August.

Mr Rowland said the recovery plan, which includes a £3.1 billion settlement package to offset the cost of reinsuring the market's losses, was the only viable option open to investors or Names the individual investors who back Lloyd's.

Analysts said the estimate for 1995 profits was evidence that Lloyd's has already done much to put the past behind it.