News - Max Re faces Nasdaq de-listing due to finite probe.

(From Reinsurance)

Max Re Capital has tentatively announced its results for the first quarter of 2006, stressing that the final results depend on the outcome of an ongoing investigation by the audit and risk-management committee of its board of directors.

The committee is investigating three finite-risk retrocessional contracts written in 2001 and 2003 to find out if the company properly accounted for them and whether they contain sufficient risk transfer to meet the requirements of Financial Accounting Standard No 113.

As a result, KPMG, the company's auditors, have not completed their Statement of Auditing Standards (SAS) 100 review of financial information for the first three months of 2006. Max Re Capital believes, subject to the results of the investigation and KPMG's SAS 100 review, that its net income for the three months ended 31 March 2006 is $74.2m.

The audit and risk-management committee has contacted the Securities and Exchange Commission (SEC) in connection with the company's internal investigation. Notwithstanding the company's current belief, there can be no assurance that the internal investigation, the SAS 100 review or any SEC inquiry or review will not result in material changes to retained earnings as of 31 December 2005, or of net income for the quarter ended 31 March 2006, or to information contained ...