Transatlantic Holdings, Inc. Announces Third Quarter Results

NEW YORK--(Business Wire)--
Transatlantic Holdings, Inc. (NYSE: TRH) today reported a net loss
for the third quarter of 2008 of ($107.5) million, or ($1.62) per
common share (diluted), compared to net income of $141.7 million, or
$2.12 per common share (diluted), in the third quarter of 2007. Net
income for the first nine months of 2008 totaled $97.9 million, or
$1.47 per common share (diluted), compared to $374.6 million, or $5.62
per common share (diluted), in the first nine months of 2007.

Commenting on the quarter, Robert F. Orlich, Chairman, President
and Chief Executive Officer, said, "Results for the third quarter were
impacted by tumultuous financial and credit markets and natural
catastrophes. In particular, Hurricane Ike was a meaningful event,
both in terms of its initial damage in the Gulf of Mexico and Texas
and its significant trail of damage through Kentucky and Ohio. While
we reported a net loss for the quarter, for the first nine months of
this year we achieved an underwriting profit, substantial net income
and net operating cash inflows ahead of last year's pace.

"Stockholders' equity declined this quarter, as was the case with
many financial institutions. Despite a generally conservative
investment portfolio, we recorded significant unrealized depreciation
due mostly to the impact of an increase in credit spreads on our fixed
maturity portfolio. In addition, we recorded unrealized currency
translation losses caused by the strengthening of the U.S. dollar."

Looking forward to the January 1, 2009 renewal season, Mr. Orlich
added, "Despite the financial market volatility and recent large loss
events, our capital and reserve positions remain strong. We see
opportunities in the current environment that we will pursue for the
right price. Catastrophe losses and financial market difficulties have
strained market capacity, and we have already seen signs of market
price stabilization that counteract trends from recent periods. In
several classes and regions, we expect to see price increases.

"Transatlantic remains strong - and we are committed to our
customers and markets worldwide. Our financial strength, history of
excellent relationships with brokers and clients, strong ratings
assigned by each of the major rating agencies and high quality and
experienced staff continue to serve us well."

(Loss) income before income taxes for the third quarter of 2008
amounted to ($153.7) million compared to $174.7 million in the third
quarter of 2007. Income before income taxes for the first nine months
of 2008 amounted to $98.4 million compared to $463.3 million in the
first nine months of 2007.

In the third quarter of 2008 and 2007, (loss) income before income
taxes includes pre-tax realized net capital (losses) gains of ($157.6)
million and $14.7 million, respectively. For the nine month periods,
income before income taxes includes pre-tax realized net capital
(losses) gains of ($232.5) million and $32.0 million in 2008 and 2007,
respectively. Realized net capital losses in the 2008 periods, which
include significant other-than-temporary impairment write-downs
related to fixed maturity (including fixed maturities included in
securities lending invested collateral) and equity securities, were
due primarily to a severe decline in market values resulting from the
downturn in the U.S. economy, ongoing turmoil in the financial markets
and credit events related to certain financial industry companies.
(Refer to the analysis of realized net capital (losses) gains in the
Consolidated Statistical Supplement for detail of the components of
realized net capital (losses) gains.)

(Loss) income before income taxes in the third quarter and first
nine months of 2008 also includes estimated pre-tax net catastrophe
costs of $146.1 million and $143.8 million, respectively, relating
largely to Hurricane Ike. Income before income taxes in the third
quarter and first nine months of 2007 also includes estimated pre-tax
net catastrophe costs of $2.9 million and $56.6 million, respectively.
The computation of net catastrophe costs involves a significant amount
of judgment and is based on information available at the time of
estimation.

Net premiums written for the third quarter of 2008 increased 11.1%
to $1,094.2 million compared to $984.6 million in the third quarter of
2007. Net premiums written for the first nine months of 2008 increased
5.6% to $3,118.3 million compared to $2,951.9 million in the first
nine months of 2007. (Refer to the table in the Consolidated
Statistical Supplement presenting the effect of changes in foreign
currency exchange rates on the increase in net premiums written
between periods.) International business represented 51% of net
premiums written in the first nine months of 2008 versus 50% in the
first nine months of 2007.

Net losses and loss adjustment expenses incurred include estimated
net adverse development related to losses (including catastrophe
events) occurring in prior years which totaled $1 million and $11
million for the third quarter of 2008 and 2007, respectively, and $2
million and $47 million in the first nine months of 2008 and 2007,
respectively.

The combined ratio for the third quarter of 2008 was 107.8% versus
93.7% in the comparable 2007 quarter. The combined ratio for the first
nine months of 2008 was 98.7% versus 95.4% in the first nine months of
2007. The aggregate net impact of pre-tax catastrophe costs and
estimated net loss reserve development related to losses occurring in
prior years added 14.8% and 1.2% to the combined ratio for the third
quarter of 2008 and 2007, respectively, and 5.0% and 3.4% to the
combined ratio for the first nine months of 2008 and 2007,
respectively.

Net loss and loss adjustment expense reserves increased $220.9
million during the third quarter of 2008, bringing the amount of such
reserves to $7.54 billion at September 30, 2008. (Refer to the
analysis of changes in net loss and loss adjustment expense reserves
in the Consolidated Statistical Supplement for additional
information.)

TRH's loss ratio represents net losses and loss adjustment
expenses incurred expressed as a percentage of net premiums earned.
The underwriting expense ratio represents the sum of net commissions
and other underwriting expenses expressed as a percentage of net
premiums written. The combined ratio represents the sum of the loss
ratio and the underwriting expense ratio. Net loss and loss adjustment
expense reserves represent unpaid losses and loss adjustment expenses,
net of related reinsurance recoverable. The combined ratio and its
components, as well as net loss and loss adjustment expense reserves,
are presented in accordance with principles prescribed or permitted by
insurance regulatory authorities, as these are standard measures in
the insurance and reinsurance industries.

Net investment income totaled $110.4 million in the third quarter
of 2008 compared to $112.2 million in the third quarter of 2007. Net
investment income totaled $348.1 million for the first nine months of
2008 compared to $347.7 million for the first nine months of 2007.
Investment income from limited partnerships was significantly lower in
the 2008 periods than in the comparable 2007 periods. At September 30,
2008, investments totaled $11.23 billion. (Refer to the analysis of
net investment income in the Consolidated Statistical Supplement for
additional information.)

Net operating cash flows for the third quarter and first nine
months of 2008 totaled $408.3 million and $901.7 million,
respectively. Net operating cash flows for the third quarter and first
nine months of 2007 totaled $353.1 million and $712.7 million,
respectively. In the third quarter and first nine months of 2008, net
repayments reduced TRH's securities lending payable by $402.7 million
and $841.3 million, respectively.

At September 30, 2008, TRH's consolidated assets and stockholders'
equity were $14.64 billion and $3.02 billion, respectively. Book value
per common share was $45.64.

In the third quarter of 2008, the Board of Directors declared a
quarterly cash dividend of $0.19 per common share to stockholders of
record as of November 21, 2008, payable on December 5, 2008.

On September 22, 2008, American International Group, Inc. (AIG),
the holder of approximately 59% of the Company's outstanding common
stock, entered into an $85 billion revolving credit facility with the
Federal Reserve Bank of New York and agreed to issue shares of
preferred stock to a trust that will hold the shares for the benefit
of the United States Treasury. In order to satisfy its repayment
obligations for amounts borrowed under the revolving credit facility,
AIG has publicly announced its intention to sell certain of its
non-core assets. On September 29, 2008, the Company announced that a
Special Committee of its independent directors was formed to evaluate
proposals received from AIG relating to the possible disposition of,
or other transactions involving, AIG's 59% common stock interest in
the Company as well as any related business combination transactions
involving the Company's outstanding shares. The Special Committee is
continuing its process, however, there can be no assurance as to
whether or when AIG will dispose of all or any portion of its interest
in the Company or whether or when the Company will engage in any
transaction.

Visit - www.transre.com - for additional information about TRH.

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Caution concerning forward-looking statements:
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This press release contains forward-looking statements, including
management's beliefs about market conditions and expectations
regarding the aggregate net impact on operating results from recent
catastrophe losses, within the meaning of the U.S. federal securities
laws. These forward-looking statements are based on assumptions and
opinions concerning a variety of known and unknown risks. Please refer
to TRH's Annual Report on Form 10-K for the year ended December 31,
2007 and the Quarterly Reports on Form 10-Q for the quarters ended
March 31, 2008 and June 30, 2008 as well as its future filings and
reports filed with or furnished to the Securities and Exchange
Commission for a description of the business environment in which TRH
operates and the important factors, risks and uncertainties that may
affect its business and financial results. If any assumptions or
opinions prove incorrect, any forward-looking statements made on that
basis may also prove materially incorrect. TRH is not under any
obligation to (and expressly disclaims any such obligations to) update
or alter its forward-looking statements whether as a result of new
information, future events or otherwise.

Transatlantic Holdings, Inc. (TRH) is a leading international
reinsurance organization headquartered in New York, with operations on
six continents. Its subsidiaries, Transatlantic Reinsurance
Company(R), Trans Re Zurich and Putnam Reinsurance Company, offer
reinsurance capacity on both a treaty and facultative basis --
structuring programs for a full range of property and casualty
products, with an emphasis on specialty risks.

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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Financial Data

Statement of Operations Data:
Three Months Ended
September 30,
------------------------
2008 2007 Change
------------ ----------- -------
(in thousands, except
per share data)
Revenues:
Net premiums written $ 1,094,182 $ 984,624 11.1 %
Increase in net unearned premiums (67,251) (24,817)
------------ -----------
Net premiums earned 1,026,931 959,807 7.0
Net investment income 110,433 112,244 (1.6)
Realized net capital (losses) gains (157,604) 14,723
------------ -----------
Total revenues 979,760 1,086,774 (9.8)
------------ -----------

Expenses:
Net losses and loss adjustment
expenses 848,258 630,053
Net commissions 241,705 249,344
Other underwriting expenses 33,638 26,597
Increase in deferred acquisition
costs (8,215) (7,833)
Interest on senior notes 10,861 10,856
Other, net 7,197 3,017
------------ -----------
Total expenses 1,133,444 912,034
------------ -----------

(Loss) income before income taxes (153,684) 174,740 -
Income taxes (benefits) (46,163) 33,014
------------ -----------
Net (loss) income ($ 107,521) $ 141,726 -
============ ===========

----------------------------------------------------------------------
Net (loss) income per common share:
Basic ($1.62) $ 2.14 -
Diluted (1.62) 2.12 -

Cash dividends per common share 0.190 0.160 18.8

Weighted average common
shares outstanding:
Basic 66,265 66,148
Diluted 66,265 66,732

----------------------------------------------------------------------
Ratios:
Loss 82.6 % 65.7 %
Underwriting expense 25.2 28.0
Combined 107.8 93.7

----------------------------------------------------------------------

Statement of Operations Data:
Nine Months Ended
September 30,
------------------------
2008 2007 Change
------------ ----------- -------
(in thousands, except
per share data)
Revenues:
Net premiums written $ 3,118,319 $2,951,872 5.6 %
Increase in net unearned premiums (51,504) (78,834)
------------ -----------
Net premiums earned 3,066,815 2,873,038 6.7
Net investment income 348,135 347,665 0.1
Realized net capital (losses) gains (232,523) 32,002
------------ -----------
Total revenues 3,182,427 3,252,705 (2.2)
------------ -----------

Expenses:
Net losses and loss adjustment
expenses 2,204,313 1,947,623
Net commissions 739,008 736,041
Other underwriting expenses 97,854 80,227
Increase in deferred acquisition
costs (8,723) (21,256)
Interest on senior notes 32,577 32,564
Other, net 18,982 14,237
------------ -----------
Total expenses 3,084,011 2,789,436
------------ -----------

(Loss) income before income taxes 98,416 463,269 (78.8)
Income taxes (benefits) 551 88,652
------------ -----------
Net (loss) income $ 97,865 $ 374,617 (73.9)
============ ===========

----------------------------------------------------------------------
Net (loss) income per common share:
Basic $ 1.48 $ 5.67 (73.9)
Diluted 1.47 5.62 (73.9)

Cash dividends per common share 0.540 0.455 18.7

Weighted average common
shares outstanding:
Basic 66,252 66,098
Diluted 66,762 66,604

----------------------------------------------------------------------
Ratios:
Loss 71.9 % 67.8 %
Underwriting expense 26.8 27.6
Combined 98.7 95.4
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Financial Data
As of September 30, 2008 and December 31, 2007

Balance Sheet Data:
2008 2007
------------ ------------
(in thousands, except
share data)
ASSETS
Investments:
Fixed maturities:
Held to maturity, at amortized cost (fair
value: 2008-$1,177,861; 2007-$1,280,011) $ 1,219,675 $ 1,249,935
Available for sale, at fair value
(amortized cost: 2008-$8,352,246; 2007-
$8,034,738) (pledged, at fair value:
2008-$1,181,828; 2007-$1,966,364) 7,928,655 8,099,252
Equities:
Available for sale, at fair value:
Common stocks (cost: 2008-$565,579; 2007-
$572,468) (pledged, at fair value: 2008-
$39; 2007-$21,900) 507,073 587,373
Nonredeemable preferred stocks (cost:
2008-$121,087; 2007-$224,298) 113,134 197,870
Trading: common stocks, at fair value
(cost: 2007-$35,916) (pledged, at fair
value: 2007-$2,144) - 35,357
Other invested assets 268,016 250,921
Securities lending invested collateral, at
fair value (amortized cost: 2008-
$1,025,840; 2007-$2,053,271) 959,756 2,012,031
Short-term investments, at cost
(approximates fair value) 237,232 67,801
------------ ------------
Total investments 11,233,541 12,500,540
Cash and cash equivalents 338,223 255,432
Accrued investment income 153,851 143,675
Premium balances receivable, net 723,997 641,026
Reinsurance recoverable on paid and unpaid
losses and loss adjustment expenses 858,081 1,074,643
Deferred acquisition costs 256,804 248,081
Prepaid reinsurance premiums 106,277 71,617
Deferred income taxes 763,018 426,600
Other assets 207,007 122,713
------------ ------------
Total assets $14,640,799 $15,484,327
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Unpaid losses and loss adjustment expenses $ 8,371,470 $ 7,926,261
Unearned premiums 1,308,830 1,226,647
Securities lending payable 1,104,017 2,054,649
5.75% senior notes due December 14, 2015:
Affiliates 448,298 448,158
Other 298,865 298,772
Other liabilities 84,943 180,798
------------ ------------
Total liabilities 11,616,423 12,135,285
------------ ------------

Preferred Stock, $1.00 par value; shares
authorized: 5,000,000; none issued - -
Common Stock, $1.00 par value; shares
authorized: 100,000,000; shares issued:
2008-67,260,447; 2007-67,222,470 67,260 67,222
Additional paid-in capital 267,043 249,853
Accumulated other comprehensive loss (438,660) (34,692)
Retained earnings 3,150,652 3,088,578
Treasury Stock, at cost; 988,900 shares of
common stock (21,919) (21,919)
------------ ------------
Total stockholders' equity 3,024,376 3,349,042
------------ ------------
Total liabilities and stockholders'
equity $14,640,799 $15,484,327
============ ============
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Financial Data

Condensed Cash Flow Data:
Three Months Ended
September 30,
-------------------------
2008 2007
------------ ------------
(in thousands)
Net cash provided by operating activities $ 408,304 $ 353,103
------------ ------------

Cash flows from investing activities:
Proceeds of fixed maturities available
for sale sold 1,445,444 175,761
Proceeds of fixed maturities available for
sale redeemed or matured 52,307 141,197
Proceeds of fixed maturities held to
maturity redeemed 25,000 -
Proceeds of equities available for sale
sold 344,614 360,584
Purchase of fixed maturities available
for sale (1,439,911) (734,663)
Purchase of equities available for sale (347,311) (353,439)
Net sale (purchase) of other invested
assets 406 952
Net sales (purchases) in securities
lending invested collateral 133,800 (287,318)
Net purchase of short-term investments (116,077) (10,556)
Change in other liabilities for securities
in course of settlement (133,763) 69,190
Other, net (13,666) 7,530
------------ ------------
Net cash (used in) provided by investing
activities (49,157) (630,762)
------------ ------------
Cash flows from financing activities:
Net change in securities lending payable (402,744) 287,318
Dividends to stockholders (12,591) (10,585)
Proceeds from common stock issued 366 1,323
Other, net (130) -
------------ ------------
Net cash (used in) provided by financing
activities (415,099) 278,056
------------ ------------
Effect of exchange rate changes on cash and
cash equivalents (6,541) 2,017
------------ ------------
Change in cash and cash equivalents (62,493) 2,414
Cash and cash equivalents, beginning of
period 400,716 223,655
------------ ------------
Cash and cash equivalents, end of period $ 338,223 $ 226,069
============ ============

Supplemental cash flow information:
Income taxes paid, net $ 25,807 $ 38,888
Interest paid on senior notes - -

Condensed Cash Flow Data:
Nine Months Ended
September 30,
-------------------------
2008 2007
------------ ------------
(in thousands)
Net cash provided by operating activities $ 901,731 $ 712,680
------------ ------------

Cash flows from investing activities:
Proceeds of fixed maturities available
for sale sold 2,794,577 928,913
Proceeds of fixed maturities available for
sale redeemed or matured 512,559 421,903
Proceeds of fixed maturities held to
maturity redeemed 25,000 -
Proceeds of equities available for sale
sold 801,756 902,011
Purchase of fixed maturities available
for sale (3,498,192) (2,063,363)
Purchase of equities available for sale (825,527) (881,060)
Net sale (purchase) of other invested
assets (22,772) 4,677
Net sales (purchases) in securities
lending invested collateral 572,356 (199,541)
Net purchase of short-term investments (174,395) (21,336)
Change in other liabilities for securities
in course of settlement (129,228) 39,268
Other, net 2,581 (1,507)
------------ ------------
Net cash (used in) provided by investing
activities 58,715 (870,035)
------------ ------------
Cash flows from financing activities:
Net change in securities lending payable (841,300) 199,541
Dividends to stockholders (33,791) (28,427)
Proceeds from common stock issued 747 4,302
Other, net 566 116
------------ ------------
Net cash (used in) provided by financing
activities (873,778) 175,532
------------ ------------
Effect of exchange rate changes on cash and
cash equivalents (3,877) 2,628
------------ ------------
Change in cash and cash equivalents 82,791 20,805
Cash and cash equivalents, beginning of
period 255,432 205,264
------------ ------------
Cash and cash equivalents, end of period $ 338,223 $ 226,069
============ ============

Supplemental cash flow information:
Income taxes paid, net $ 104,310 $ 153,079
Interest paid on senior notes 21,563 21,563
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Financial Data

Comprehensive (Loss) Income Data:
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ----------------------
2008 2007 2008 2007
----------- --------- ------------ ---------
(in thousands)
Net (loss) income ($ 107,521) $141,726 $ 97,865 $374,617
----------- --------- ------------ ---------

Other comprehensive (loss)
gain:
Net unrealized
(depreciation)
appreciation of
investments, net of
tax:

Net unrealized holding
(losses) gains (471,111) 36,686 (794,285) (84,933)
Deferred income tax
benefit (charge) on
above 164,890 (12,840) 278,000 29,727
Reclassification
adjustment for losses
(gains) included in
net (loss) income 161,907 (17,011) 222,594 (43,397)
Deferred income tax
(charge) benefit on
above (56,668) 5,954 (77,908) 15,189
----------- --------- ------------ ---------
(200,982) 12,789 (371,599) (83,414)
----------- --------- ------------ ---------

Net unrealized currency
translation (loss)
gain, net of tax:
Net unrealized
currency translation
(loss) gain (108,025) 60,977 (49,799) 91,134
Deferred income tax
benefit (charge) on
above 37,809 (21,342) 17,430 (31,897)
----------- --------- ------------ ---------
(70,216) 39,635 (32,369) 59,237
----------- --------- ------------ ---------

Other comprehensive
(loss) gain (271,198) 52,424 (403,968) (24,177)
----------- --------- ------------ ---------

Comprehensive (loss)
income ($ 378,719) $194,150 ($ 306,103) $350,440
=========== ========= ============ =========
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Premium Data:
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- ---------------------
2008 2007 2008 2007
---------- --------- ---------- ----------
(in thousands)
Net premiums written by
office:

Domestic $ 525,155 $472,368 $1,528,474 $1,482,348
---------- --------- ---------- ----------

International:

Europe:
London 221,267 210,363 637,495 600,636
Paris 86,522 85,893 280,965 257,429
Zurich 106,574 101,615 283,898 265,711
---------- --------- ---------- ----------
414,363 397,871 1,202,358 1,123,776
---------- --------- ---------- ----------

Other:
Toronto 25,750 28,918 63,144 75,421
Miami (Latin
America and
the
Caribbean) 92,660 58,319 211,122 170,403
Hong Kong 26,786 21,251 72,744 65,826
Tokyo 9,468 5,897 40,477 34,098
---------- --------- ---------- ----------
154,664 114,385 387,487 345,748
---------- --------- ---------- ----------

Total international 569,027 512,256 1,589,845 1,469,524
---------- --------- ---------- ----------

Total net premiums written $1,094,182 $984,624 $3,118,319 $2,951,872
========== ========= ========== ==========

Net effect of changes in foreign currency exchange rates on the
increase in net premiums written in 2008 as compared to 2007:

Three Nine
Months Months
Ended Ended
September September
30, 30,
---------- ---------
Increase in original
currency 9.8% 2.6%
Foreign exchange effect 1.3 3.0
---------- ---------
Increase as reported in
U.S. dollars 11.1% 5.6%
========== =========
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Premium Data (continued):

Other net premiums written data (estimated):

Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- ----------------------
2008 2007 2008 2007
----------- ---------- ----------- -----------

Treaty 96.3 % 96.2% 96.7 % 96.2%
Facultative 3.7 3.8 3.3 3.8
----------- ---------- ----------- ----------
100.0 % 100.0% 100.0 % 100.0%
=========== ========== =========== ==========

Property 33.2 % 28.7% 31.0 % 29.5%
Casualty 66.8 71.3 69.0 70.5
----------- ---------- ----------- ----------
100.0 % 100.0% 100.0 % 100.0%
=========== ========== =========== ==========

Total gross premiums
written (in thousands) $1,181,280 $1,043,625 $3,377,769 $3,214,939
=========== ========== =========== ==========

Source of gross premiums written:

Affiliates 12.0 % 11.7% 12.9 % 13.2%
Other 88.0 88.3 87.1 86.8
----------- ---------- ----------- ----------
100.0 % 100.0% 100.0 % 100.0%
=========== ========== =========== ==========

Supplemental Net Loss and Loss Adjustment Expense Reserve Data:

Changes in net loss and loss adjustment expense reserves:

Three Months Ended Nine Months Ended
September 30, September 30,
---------------------- -----------------------
2008 2007 2008 2007
----------- ---------- ----------- -----------
(in millions)
Reserve for net unpaid
losses and loss
adjustment expenses
at beginning of
period $ 7,316.6 $ 6,450.5 $ 6,899.7 $ 6,207.2
Net losses and loss
adjustment expenses
incurred 848.3 630.1 2,204.3 1,947.6
Net losses and loss
adjustment expenses
paid 506.2 434.9 1,497.9 1,540.9
Foreign exchange
effect (121.2) 23.0 (68.6) 54.8
----------- ---------- ----------- ----------
Reserve for net unpaid
losses and loss
adjustment expenses
at end of period $ 7,537.5 $ 6,668.7 $ 7,537.5 $ 6,668.7
=========== ========== =========== ==========
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Investment Data:
Net investment income:
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2008 2007 2008 2007
---------- ------- --------- -------
(in millions)
Fixed maturities $ 105.8 $101.3 $ 318.9 $291.5
Equities 5.7 5.3 13.9 20.8
Other invested assets
(including limited partnerships) (4.5) 3.8 5.1 27.5
Other 5.9 4.3 17.9 14.8
---------- ------- --------- -------
Total investment income 112.9 114.7 355.8 354.6
Investment expenses (2.5) (2.5) (7.7) (6.9)
---------- ------- --------- -------
Net investment income $ 110.4 $112.2 $ 348.1 $347.7
========== ======= ========= =======

Realized net capital (losses) gains:
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2008 2007 2008 2007
---------- ------- --------- -------
(in millions)
Sales of securities ($ 37.7) $ 19.9 ($ 20.2) $ 46.8
Other-than-temporary impairment
write-downs (124.2) (2.9) (202.4) (3.4)
Net foreign currency transaction
gains (losses) 4.3 (2.3) (9.9) (11.4)
---------- ------- --------- -------
Realized net capital (losses)
gains ($ 157.6) $ 14.7 ($ 232.5) $ 32.0
========== ======= ========= =======
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Investment Data:
Investments by category:
September 30, 2008
------------------------
Amount Percent
------------ -----------
(dollars in thousands)
Fixed maturities:
Held to maturity (at amortized cost):
Municipalities $ 1,219,675 10.8%
------------ ----------

Available for sale (at fair value):
Corporate 2,012,249 17.9
U.S. Government and government agencies 167,027 1.5
Foreign government 237,288 2.1
Municipalities 5,298,472 47.2
Asset-backed securities 213,619 1.9
------------ ----------
7,928,655 70.6
------------ ----------
Total fixed maturities 9,148,330 81.4
------------ ----------
Equities available for sale:
Common stocks 507,073 4.5
Nonredeemable preferred stocks 113,134 1.0
------------ ----------
Total equities 620,207 5.5
------------ ----------
Other invested assets 268,016 2.4
Securities lending invested collateral 959,756 8.6
Short-term investments 237,232 2.1
------------ ----------
Total investments $ 11,233,541 100.0%
============ ==========
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Investment Data (continued):

Fixed maturities portfolio data:

Ratings as of September 30, 2008:

AAA AA A BBB Other (b) Total
------ ------ ----- ----- ---------- -------
(in millions)
Held to maturity:
Non-asset-backed (a) $ 596 $ 561 $ 63 $ - $ - $ 1,220
------ ------ ----- ----- ---------- -------

Available for sale:
Asset-backed:
Commercial mortgage-
backed 67 - 10 - 10 87
Residential:
Mortgage-backed:
Alt-A 62 - - - 12 74
Prime non-agency 31 - - - - 31
HELOC - - - - 9 9
Other asset-backed - 12 - - - 12
Non-asset-backed (a) 2,869 4,059 736 26 25 7,715
------ ------ ----- ----- ---------- -------
Total available for
sale (c) 3,029 4,071 746 26 56 7,928
------ ------ ----- ----- ---------- -------

Total fixed
maturities $3,625 $4,632 $ 809 $ 26 $ 56 $ 9,148
====== ====== ===== ===== ========== =======

Percent of total fixed
maturities 39.6% 50.6% 8.9% 0.3% 0.6% 100.0%
====== ====== ===== ===== ========== =======

(a) Non-asset-backed fixed maturities in the aggregate include
insured municipal bonds with ratings as follows:

Below
BBB or
AAA AA A BBB Not Rated Total
------ ------ ----- ----- ---------- -------
Insured rating $1,125 $1,597 $ 314 $ - $ 4 $ 3,040
Underlying rating 224 2,065 718 22 11 3,040

(b) Consists of BB rated securities, except for $6 million of non-
asset-backed securities which are not rated.

(c) At September 30, 2008, pre-tax net unrealized depreciation on
the available for sale fixed maturity portfolio totaled $424
million. $39 million of such amount relates to asset-backed
securities and $385 million relates to non-asset-backed
securities.

Duration as of September 30, 2008: 6.2 years
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Investment Data (continued):

Securities lending invested collateral data (a):

Ratings of securities lending invested collateral
as of September 30, 2008:

AAA AA A BBB B Total
------- ------- ------------- ----- ----- -------
(in millions)
Fixed maturities
available for
sale:
Foreign asset-
backed:
Commercial
mortgage-
backed $ 78.8 $ 5.9 $ - $ - $ - $ 84.7
Residential
mortgage-
backed 241.4 13.6 - - - 255.0
Other asset-
backed 22.2 5.2 - - - 27.4
------- ------- ------------- ----- ----- -------
Total
foreign
asset-
backed 342.4 24.7 - - - 367.1
Foreign non-
asset-backed 37.8 278.4 207.1 1.0 1.9 526.2
------- ------- ------------- ----- ----- -------
Total fixed
maturities
available for sale$380.2 $303.1 $ 207.1 $1.0 $1.9 893.3
======= ======= ============= ===== =====
Cash equivalents 66.5

-----
Total securities
lending invested
collateral (b) $959.8
=======

Total securities
lending invested
collateral
invested in fixed
maturities
available for sale
by rating 42.6% 33.9% 23.2% 0.1% 0.2% 100.0%

(a) Information presented herein represents the
fair value of underlying securities included
on the Balance Sheet as securities lending
invested collateral.
(b) At September 30, 2008, pre-tax net unrealized
depreciation on the securities lending
invested collateral totaled $66.1 million.
$45.9 million of such amount relates to
asset-backed securities and $20.2 million
relates to non-asset-backed securities.

Duration of fixed maturities available for sale
included above as of September 30, 2008: 0.1
years
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Transatlantic Holdings, Inc. and Subsidiaries
Consolidated Statistical Supplement

Supplemental Investment Data (continued):

Other investment data:

Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- -----------------
2008 2007 2008 2007
---------- ---------- -------- -------

Pre-tax yield on fixed
maturity portfolio (a) 4.5% 4.5% 4.5% 4.4%

Effective tax rate on net
investment income (b) 12.0% 15.8% 14.0% 16.8%

(a) Represents annualized pre-tax net investment income from fixed
maturities (excluding fixed maturities included in securities
lending invested collateral) for the periods indicated divided
by the average balance sheet carrying value of the related fixed
maturity portfolio for such periods.
(b) Represents the portion of income tax expense related to
net investment income divided by net investment
income.

Other
Data:
(Estimated)
September December
30, 31,
2008 2007
----------- ----------
(in thousands)
Statutory surplus of
Transatlantic Reinsurance
Company(R) $ 3,321,000 $3,368,801
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Transatlantic Holdings, Inc., New York
Steven S. Skalicky, 212-770-2040

Copyright Business Wire 2008