Glacierre Press Release

PRESS RELEASE
2005-10-17
Glacier Reinsurance AG

$100 million common stock issue to increase underwriting capacity

Statement concerning losses arising from Hurricanes Katrina and Rita

Glacier Reinsurance AG (“Glacier Re” or “the Company”), the European reinsurance company, announced today that existing shareholders have subscribed for additional equity of US$ 100 million, through its holding company Glacier Re Holdings s.à.r.l.. The equity issue will increase the underwriting capital of the Company in order to respond to favourable market conditions following Hurricanes Katrina and Rita.

Glacier Re estimates that the losses arising from Hurricanes Katrina and Rita will result in a net loss after tax of US$ 38 - 58 million. This estimate is subject to a number of variables which are impacted by the complexity and magnitude of the loss as well as restoration and business interruption issues.

Management estimates the underwriting capital of the Company will be in excess of US$ 400 million at 31 December 2005: over US$ 100m higher than at the beginning of 2005. This is a result of the current equity issue, initial capitalisation proceeds of US$ 300 million from common stock issued in December 2004, the issuance of US$ 50 million of subordinated notes in May 2005 as well as ongoing operations.

Robbie Klaus, Chief Executive Officer and Chief Underwriting Officer of Glacier Re said:

“We are delighted with the support we have received from our shareholders who appreciate the market opportunity that exists for Glacier Re. While our losses from Hurricanes Katrina and Rita are not insignificant the gross losses are well within our modelled scenarios and reflect a relatively small proportion of the overall market loss.

“Glacier Re’s business plan is to react to significant market events. With the addition of this new capital to an already strong balance sheet with no legacy issues, we are in a very good position to provide solid security to our customers in the future”.