Good day ladies and gentlemen and welcome to the First Quarter 2008 AXIS Capital Holdings Ltd. Earnings Conference Call. My name is Erica and I will be your coordinator for today. At this all participants are in a listen-only mode, we will be facilitating a question-and-answer session towards the end of this conference. [Operator Instructions]. I will now like to turn the presentation over to your host for today's call Ms. Linda Ventresca, Investor Relations Officer, please proceed.

Thank you, Erica. Good morning ladies and gentlemen. I am happy to welcome you to our conference call to discuss the financial results for AXIS Capital for the quarter ended March 31st, 2008. Our first quarter earnings press release and financial supplement were issued yesterday evening after the market closed. If you would like copies, please visit the Investor Information section of our website, www.axiscapital.com. We set aside an hour for today's call, which is also available as an audio webcast through the Investor Information section of our website through May 23rd. An audio replay will also be available through May 9th. The toll free dial in number for the replay is 888-286-8010 and the international number is 617-801-6888. The pass code for both replay dialing numbers is 38608105. With me on today's call are John Charman, our CEO and President and David Greenfield, our CFO. Before I turn the call over to John I would remind everyone that statements made during this call including the Q&A session which are not historical facts may be forward-looking statements within the meaning of the U.S. Federal Securities Laws. Forward-looking statements contained in this presentation includes, but are not necessarily limited to, information regarding our estimate of losses related to catastrophes and other loss events. Future growth prospects and financial results, evaluation of loses and loss reserves, investment strategies, investment portfolio and market performance impact to the marketplace with respect to the changes in pricing models and our expectations regarding pricing and other market conditions. These statements involve risks, uncertainties and assumptions which could cause actual result to differ materially from our expectations. For discussion of these matters please refer to the Risk Factor section in our most recent Form 10-K on file with the Securities and Exchange Commission. We undertake no obligation to update or revise publicly any forward-looking statements whether as a result of new information, future events or otherwise. In addition, this presentation contains information regarding operating income which is a non-GAAP financial measure within the meaning of the U.S. Federal Securities Laws. For a reconciliation of this item to the most directly comparable GAAP financial measure please refer to our press release and Form 8-K issued last night which can be found on our website. With that, I'll now turn the call over to John.

Thank you, Linda. Good morning ladies and gentlemen and thank you for taking the time to join us this morning. I am going to begin by making some brief opening remarks, then I will turn the call over to David Greenfield to review our financial results. Following David's review, I will discuss current market conditions. I am pleased once again to announce that we have achieved our tenth consecutive quarter of record earnings for AXIS. We have earned $238 million in net income and delivered an annualized return on average common equity of 20% for the quarter. Our diluted book value for our common share increased by 19% over the last 12 months and by 4% from year end to nearly $30. These results were achieved despite the strong negative headwinds presented by a combination of unusually high levels of worldwide risk losses, cat losses and unprecedented turbulence in the financial markets. With that, I'd like to turn the call over to David to discuss the financials in more detail.

Thank you, John and good morning everyone. As John mentioned, we are pleased with our results for the first quarter 2008 which mark another quarter of record earnings against the comparable prior year period, our tenth in a row. Once again we have demonstrated the powerful earnings potential of the global AXIS franchise. For the quarter, net income was $238 million, a 4% increase over the first quarter of 2007. Earnings per diluted share for the quarter of $1.48 compared to $1.37 per diluted share for the first quarter of 2007. After tax operating income which excludes the impact of realized gains and losses on investments was $205 million or $1.28 per diluted share, compared to $227 million or $1.37 per diluted share for the prior year quarter. These results translate through an impressive annualized return on average common equity for the quarter of 20%. Our quarter end diluted book value per share of nearly $30 has increased 19% over the last 12 months and 4% since year end 2007. Turning to our top line, our consolidated gross premiums written were $1.3 billion, down 3% from the first quarter of 2007. The competitive market conditions continue to present challenges this quarter, although we were still able to identify good profit potential within our areas of focus. Gross premiums written in our insurance segment were $435 million, relatively unchanged from the first quarter of last year. Competitive market conditions drove exposure reduction in a number of our property and casualty lines. But this was offset by continued growth of our political risk business and renewal rights acquired with the purchase of Media Pro late in the second quarter of 2007. Gross premiums written in our reinsurance segment this quarter, were $829 million, down 4% from the first quarter of 2007. When…

Thank you, David. I'll now comment on some of the events in the quarter and more broadly on market conditions. Certainly the events of the quarter should serve as a healthy reminder to the industry that we are in, a risk bearing business and that the current irresponsible competition focused in the insurance sector is absolutely irrational and unnecessary, even more so when one considers the back drop of cumulative worldwide losses from individual risk losses of smaller cat events likely to produce insured losses of over $7 billion. As David discussed in reviewing our insurance segment we have estimated our net losses from world wide risk losses that approximately $25 million we are a major participant in the whole sale commercial PNC markets. And as such we expect to have exposure to large losses like these. We do view these events as a normal event however the less normal parts of the loss activity is the frequency that has occurred within the quarter. Our prudent risk management efforts including our increased reinsurance, purchasing activities over the last few years, have served as well by appropriately limiting the over all impacts of frequency to our consolidated under running profitability. This has allowed us to reduce our net losses from risk losses in the quarter, to less than 1% of market losses which we estimate exceed $3 billion, a performance I'm very pleased with. Turning to market conditions, in our insurance segment for all of business lines are under extreme pricing pressure with only one notable exception, we are begin to see some stabilization in the financial institution classes within our professional alliance business. Large account property rate reduction demands starting the range of 20% to 50% with sub limits increasing, but fortunately a limited degree of deductible erosion is occurring.…

[Operator Instructions]. Our first question comes from the line of Susan Spivak from Wachovia. Please proceed.

Hi, good morning everybody.

Good morning Susan.

The superior under writing result really speak for themselves and I think the ROV on an operating basis is still excellent. I think what puzzles me is that levels there just wasn't any share repurchase and historically I know you have been very opportunistic with capital. So if you are not buying back your shares I just want to get into your head and see what are the opportunities that you are looking at and taking that a bit further if Axis were likely to make an acquisition going forward. Do you think could you rank whether it would be Bermuda base, U.S. based or UK or on the continental? That's my question for John. For David you seemed a little bit more cautionary about the reserve releases going forward, should we be worried that the comparisons are going to be a little bit tougher, next year, that's on what you currently been releasing and then going forward on this specialty and professional lines. Could you just review with us what percentage or how much of your reserved are in those lines? And then finally on the technology investment. Is it significant that we should be incorporating that into your expense ratio? Yeah I know it was lot.

That was a long breath. Well good morning again Susan, and thanks for the question. As far as the share repurchase questions is concerned I think that it's very appropriate with market conditions with the dislocation and potential continuing dislocation we progress through this year that we believe we should hold our capital who knows what opportunities might present themselves. We don't have a fixed view where those opportunities might come from. But we want to be in the best possible positions take advantage of them and we are. David?

Susan I may need some help because you rattled through a number of questions there. But let me first take the one on reserve releases. I wouldn't say that my tone or approach to the reserve releases has changed to any of the comments that I have previously made to you and others about incorporating reserve releases in future performance. What I was merely trying to do is continuing along the path of explaining that as we grow and as we continue to develop our business we are beginning to incorporate more and more of our own experience into our reserving estimates and that will by definition impact the reserving process in terms of the accuracy and also in terms of future releases that could potentially occur. So, that was really more an exercise in trying to show the development of our reserving processes as we continue to grow our business.

It is more on what you've said on most of the conference calls about the risk involved...

Yes, little deeper this because we are doing little more incorporation of our own data and we want to make sure that you are aware of that but essentially the same messages before --.

Professional lines?

I didn't get exactly what are you asking us so can you repeat that one.

Just what percentage of your total reserve now are in those special team professional lines it seems to me that you indicated that now that five years have past we could start to see some releases from those lines?

Well, I think first of all with regard to releases from those lines keep in mind that this five years back those lines were relatively small in the context of our overall business. But certainly your earlier years, we are going to look at coming up soon but the more of activity in those lines have been in the last several years which we still have some more time to let mature. In terms of the percentage of reserves along the areas you asked about in the specialty professional lines, it's roughly a third of the total reserve balances in that area.

Susan, you can remember that on the insurance side, we bought in Jack Kuhn and his great team of 53 the people at the end of the first quarter of '03. And then secondly, Mike Morrill the majority of Mike Morrill's business in '03 actually was professional lines reinsurance.

Okay. And then just the technology investments, any should we be incorporating arising expense ratio for that or is that just part of ongoing business expense?

Let's go David you go ahead.

No, I was just going to remind you my earlier remarks, I mentioned I think a useful run rate for the rest of '08 is about $80 million give or take a little bit. We are making our technology investments as we need to within the context of that overall estimate if you will.

But it's critical to us Susan because we have to invest for the future and we are substantially positioning ourselves not only for our select markets growth but also generally throughout the company, to give to optimize our efficiency productivity and our capability.

Okay and then if I could just follow up where one more John, any change in the reinsurance purchases, on the insurance beck, are you staring to buy even more?

Yes, I have said to you at the last quarter that I never understand why underwriting businesses retain more in sub-cycles. And we'll see how this I have never done that, I have always done and will see how it works through it. So we remain very opportunistic, we remain very demanding with our reinsurers and we will get through the rest of the year.

Okay, all right I'll let the rest of the line go, I am sure you have lot of a lot more. Thanks guys.

Thank you Susan.

Our next question comes from the line of Josh Shanker from Citigroup. Please proceed.

Good morning.

Good morning Josh.

In terms of sort of philosophical change, I am trying to understand one thing that David said, would was that you start writing professional line reliably back in '03, it's earlier than I thought. At that time on these conference call and even in the prospective, it's clear that you were fairly a vocal critic of long-tailed business, what sort of change about long-tailed business over the year that's made you more comfortable or may be I have misread your comments in the past?

Well, I think you have misread my comments in the past, Josh with a greater respect, because I have said many, many times in those early years that I after the pooling underwriting results, out of the professional lines markets from the underwriting that took place between '97 and 2001. Which essentially was more about financial guarantee and indemnity policies. The whole that suite of products was completely rewritten and recharged by the market in 2002. And we took advantage of that in 2003 by bringing here I said Jack Kuhn and 50 of his great people in the spring of '03. And we did that because quite frankly there has been a sea change in the way that those products were being written and delivered and priced. And in my view I said it the and I have been very consistent about it since. I believe that those products could be more medium-tailed in their characteristics than long-tailed. I continue to be very conservative and AXIS continues to be very conservative its long-tail cash of the underwriting.

The other question regard to I am not back to where you are of thinking of M&A transaction but in general philosophy is it better to buy companies in the soft market when evaluations are low. But you need harder on their balance sheet or better to buy companies in a better pricing market when balance sheet appear solid but the prices are more expensive?

You buy companies when opportunity presents it selves and that can be on either side of your two scenarios. But we would only look to those sort of acquisitions too materially enhance or franchise and our earnings power.

In terms of other ways returning to capital you may be right now our share repurchases be the most comfortable. What are your thoughts on increasing dividend?

Josh,we have just increased our dividend our Board increased the dividend last December the quarter ago. So they do consider that during their Board meeting and I am sure that they will consider that again this year but I wouldn't expect the dividend increase any time soon in the next few quarters. So we have been tracking to a dividend change once a year more or less.

And what about perhaps the special after the hurricane season?

We have got a lot of other things but as I said that we really don't know what's going to happen through the rest of this year there is there is extraordinary competition throughout the underwriting businesses there is great volatility throughout the investment community. And out of that might come lots of opportunity for us so we are not going to commit our selves through our need, forward thinking in that respect.

Alright very good work good luck to you.

Thank you.

Thank you Josh.

Our next question comes from the line of Matthew Heimermann, JPMorgan. Please proceed.

Hi, good morning every one.

Good morning Matt.

Thanks, a couple of good questions would you be wanting to discuss with the gross loss look like in the insurance segment just to give us the sense of how that reinsurance is helping?

You said that two questions what was the second?

I was going to go one at a time. Second question is I was curious if you could talk about any whether or not there were any or you are planning any significant changes to just the cat XOL program this year. And then the other question was in the fourth quarter you talked about there was a contract written in the fourth quarter of '06 with a 60 month and I wanted to ask whether or not that renewed this quarter or that was a second quarter thing I can talk these looking at the numbers.

I'll take the first and the third. In terms of the gross losses on those events were roughly about little over $100 million is the number there Matt.

Okay.

So, on that one I can cover you and then the third comment on the reinsurance contract that you are referring to that we mentioned last quarter we didn't renew. We did renew that contract this quarter.

Okay.

And its in the re-insurance figures.

Okay, perfect thank you.

And then with the we are in that special very carefully rated that we are in the process of renewing our properly reinsurance renewals and my previous comments apply as much to what's going out at the moment is what we will continue to do throughout the rest of this year.

Okay. That's helpful. Thank you very much.

Thanks.

Thank you.

[Operator Instructions]. Our next question comes from the line of the Vinay Misquith from Credit Suisse. Please proceed.

Hi good morning.

Good morning Vinay.

Good morning Vinay.

Two questions and firstly this is beat the dead horse but John on the acquisition front, just philosophically would you be looking more outside U.S. say in Asia or would something within the U.S. on the primary insurance and be more attractive to you.

Well, there are two ends of the spectrum that we've continue have said rather like Media Pro with we are searching very hard to try to find smaller opportunities that create strategic advantage for us, so and we will go wherever we need to and our focus is as much in Asia than the emerging markets as it is quite frankly in the more mature markets of U.S, then at the other end of the spectrum, it has to be an opportunity that would be strategic and would materially enhance not only our franchise capability but also our earnings capability and continue to diversify the products we sell.

Sure, fair enough. Second question is for David. David on the reinsurance segment if you exclude the last catastrophes in the first quarter of '07 your accidental year loss ratio was about 58.1, this quarter it's about 65.7 but it seems to be a 7 point increase in the accident year loss ratio ex-cat, just wondering, whether you had some lost catastrophes in the reinsurance segment in this quarter?

Well a couple of things I mean first of all, when you are comparing to a year ago we had material in the first quarter of '07 of and then secondly I would tell you in the current quarter as I have mentioned in my comments we did see some normal events if you will in this quarter that affected us but nothing of significance on anyone event that we would comment on specifically so there was some loss activity this year just not at a single event loss level like a Kyrill event.

Sure, thank you.

Okay.

Thanks Vinay.

Our next question comes from the line Ian Gutterman from Adage Capital. Please proceed.

Hello everyone, Hi John, I have a couple of questions, first the large individual risk losses in the quarter, you mentioned obviously the frequency was higher than usual, I was wondering if you how much of that is truly random and how much of that might be something secular, just given from what I noticed, a lot of them were commodity related and we know just given in place in the commodity demand that a lot of these factories and mines and so forth are running a lot harder than they used too and may be are more accident prone, do you think that's a trend and we should expect higher losses in that segment in the future and is industry figure that out from a underwriting standpoint stand point?

I think you have raised an interesting point because the market, I believe is behind the curve in dealing with the increased commodity prices and the way the as you quite rightly say, these companies are working even harder to make sure they maximize their output to take advantage of those pricing circumstances and it certainly has very substantially heightened awareness of the increases risk involved as a result of the activities in the commodities field and I am not sure that is a lesson that was probably broadly been learned around our competitors that has but certainly for us that we are extraordinarily more sensitive to the impact our those ever increasing commodity prices and perhaps a lesson in risk management, in order to make increased profitability from those individual companies. So we are we are taking it very seriously and we don't know whether it's going to be a trend but we are very sensitive to it.

Okay and thank you very much.

And that's why again and again we would look very carefully at the reinsurance market to try and help us as a part of our risk management.

Thank you, very through answer, its kind of way I was hoping you would say. The other question is to push you a little bit on how soft the market is and some of those insurance line you mentioned, and being as bad as the bottom of the last half market. I guess where I struggle trying to understand that comment is last time we saw those we saw loss ratio not combined ratio, loss ration on some of those lines well north over 100 may be 150, 200. Are you suggesting that loss ratio is in part to the industry or price at over 100 at this point. Because it doesn't seem like anyone --.

As I said that I tend to be a little bit more aggressive in my remarks then most other CEO's mainly because they are so detached from their underwriting businesses that they have got no idea about the reality of what's taking place on the ground floor. I don't think that what happened was during that last cycle if you remember you have observed underwriting competition. That created enormous value disruption between 1997 and 2001. And that is a occurring today without a shadow of the doubt. The fact that Lloyds can give $1 billion of terrorism capacity to the Middle Eastern entity. There is a 100 miles from Iran for under $700,000 of premium and that is all written within that particular marketplace I hope, I am not having a go at them specifically I'm just using some examples. The fact that a major U.S. property casualty business. Will offer a 50% reduction in price If its allowed to write a 100% of the business. So can cede it to its reinsurers and try to take over rights on it. That sort of behavior I see increasingly more and more on a daily basis.

Okay

But go back to the last go back to the last, and we navigate that. we are on top of our game day-in and day-out throughout our. We just stepped back and let them go kill themselves. So but the reality is back in '97 to 2001 you had similar underwriting behavior and lack of management over side. The difference in two between that period and this period you have to remember there was the reemergence of late and liability issues. As best as suddenly reared its ugly head again. And compounded that the soft market conditions heavily and started to play great strain in on the solvency of companies. And then of course thirdly you had the appalling tragedy of the World Trade Centre which was unmodeled and unexpected and $50 billion. So we are only facing in reality I think one of those three pressure points. But so I don't expect extremes of loss pick movement unless there are major losses, unless there are major catastrophe loses occurred at the same time and I have a wonderful expression called Sod's Law and that can normally take place when you least expected. So what I believe will happen is the fact that this year will show continued deterioration steady deterioration of lost picks. Will this companies that are not underwriting in the market place, under the revenue generating and I think it's going to be important to pick that sort of stuff up.

Okay, great. Very fair answer John, I appreciate it.

Thank you.

Thank you.

Our last question comes from the line of Alain Karaoglan from Banc of America. Please proceed.

Good morning.

Good morning Alain.

Two questions, thank you for the clarification on Ian's question and if I may just ask to add some is it are we focusing essentially your comments mostly on large accounts more than smaller and middle market account because also if in 1997 to 2001 the reinsurance market was extremely competitive and facilitating a lot of insurance companies underwriting and this time around you seemed to think insurance market is relatively stable, would that be --.

That's what I Alain, I have not understood the financials of many companies that I of I've seen that demonstrate on the insurance side that weak under writing activity which was what I was concentrating on because I've said over the last 18 months the re-insurance market has remained pretty stable and has not given the margin to the primary insurers to allow them to gift the sort of margin offered, there are giving and so I would have expected their last picks to begin to reflect much earlier than they get to show. So, I am equally as puzzled as you should be.

Okay. Now, a follow up question to the accident share loss ratio I think David you mentioned that I believe in insurance but the accident share loss ratio increase by 3.3 points versus last year and that the sort of large losses cost 8.2 points in this quarter, so does that mean that your loss picks are 5 points lower than they were in last year or this to simplify the math to that I am doing?

Yes, my initial reaction will be that the, that you are little too simplified but I don't have, I guess I don't have all that in front for me to follow what your where you were coming, hold on a second, well by that we can take that off call I think rather than fluster around.

Okay.

I mean, I think in brief it's going to be driven by the comments I made about using our own experience in loss ratio, initial expected loss ratio is also going to be impacted by price deterioration, but you know to reconcile those numbers but we can take that offline.

Okay, thank you very much.

Thanks.

There are no further questions; I will now like to turn the call over to John Charman for closing remarks.

Well, thank you again ladies and gentlemen's for taking the time to listen to us and I hope that you get a sense of where we are, I hope you'll get a sense of where we are going to be the next quarter and where we are going to be for the rest of the year, but thank you again for the taking the time to listen to us.

Thank you for participation in today's conference, this concludes the presentation, you may now disconnect. Have a good day.