Alterra Capital 8-K Results of Operations and Financial Condition

Exhibit 99.1

MAX RE CAPITAL LTD. REPORTS NET INCOME FOR 2005:

Hamilton, Bermuda, February 10, 2006 - Max Re Capital Ltd. (NASDAQ: MXRE) today reported a net loss for the three months ended December 31, 2005 of $11.4 million, or a net loss of $0.20 per diluted share, compared to net income of $87.1 million, or net income of $1.82 per diluted share, for the three months ended December 31, 2004. Net operating loss, which represents net loss increased by net realized loss on sale of fixed maturities, for the three months ended December 31, 2005 was $7.9 million, or a net operating loss of $0.13 per diluted share, compared with a net operating gain of $80.8 million, or a net operating earnings of $1.67 per diluted share, for the three months ended December 31, 2004.

For the year ended December 31, 2005, the Company had net income of $6.7 million, or net income of $0.13 per diluted share, compared to $133.7 million, or $2.75 per diluted share, for the year ended December 31, 2004. For the year ended December 31, 2005, the Company had net operating income of $7.4 million, or net operating income of $0.14 per diluted share, compared to $123.3 million, or $2.54 per diluted share, for the year ended December 31, 2004.

Robert J. Cooney, Chairman, President and Chief Executive Officer, commented, “The Company recorded a reduction in net income of $157.4 million from natural catastrophes during 2005, but despite these events we are pleased to report a small net income for the year. We successfully raised $284.1 million in a public common share offering in the fourth quarter of 2005 and are well positioned to participate in the expected attractive market for our products in upcoming months.”

Gross premiums written for the three months ended December 31, 2005 were $257.2 million, of which $251.3 million came from property and casualty underwriting and $5.9 million from life and annuity underwriting, compared to $139.6 million, $104.6 million coming from property and casualty underwriting and $35.0 million of life and annuity underwriting, for the three months ended December 31, 2004. Net premiums earned for the three months ended December 31, 2005 were $256.7 million compared to $216.0 million for the same period of 2004, the increase is principally due to $123.9 million of additional property and casualty premiums written and earned on a prior period contract resulting from loss development recorded, partially offset by reduced life and annuity premiums written and earned in the three months ended December 31, 2005. Gross premiums written for the year ended December 31, 2005 were $1,246.0 million compared to $1,043.6 million for 2004. Property and casualty reinsurance, property and casualty insurance and life and annuity reinsurance accounted for 49.4%, 28.5% and 22.1%, respectively, of gross premiums written for the year ended December 31, 2005. Net premiums earned for the year ended December 31, 2005 increased 13.2% to $1,039.4 million compared to $917.8 million for the same period in 2004.

Net investment income for the three months ended December 31, 2005 increased to $31.2 million, from $24.2 million for the same period in 2004 and is principally attributable to increased cash and fixed maturities balances held. Net investment income for the year ended December 31, 2005 increased $24.0 million, to $106.8 million from $82.8 million for the same period in 2004.

Net losses on alternative investments for the three months ended December 31, 2005 were $13.7 million, including $20.6 million in reinsurance private equity losses related to hurricane activity, or a negative 1.11% rate of return, compared to net gains on alternative investments of $56.8 million, including $2.8 million in reinsurance private equity gains, or a 5.36% rate of return, for the same period of 2004. For the year ended December 31, 2005, alternative investments have returned $39.9 million or 3.34%, compared to $81.6 million or 8.23% for the same period in 2004. Invested assets were $4.2 billion as of December 31, 2005, with an allocation of approximately 71% to cash and fixed maturities and 29% to alternative investments.

Losses and benefits were $247.0 million for the three months ended December 31, 2005 compared to $163.4 million for the same period in 2004. The increase in losses and benefits for the three months ended December 31, 2005 is principally attributable to the losses associated with premiums earned, additional loss development of $129.7 million related to a prior period contract and the recording of $23.4 million in natural catastrophe losses. Losses and benefits for the year ended December 31, 2005 were $1,018.9 million compared to $764.3 million for the same period in 2004. The increase for the year ended December 31, 2005 is also principally attributable to the increase in premiums earned , the recording of losses from natural catastrophes and loss development on prior periods.

Acquisition costs for the three months ended December 31, 2005 decreased by 45.3% to $16.3 million compared to $29.8 million for the three months ended December 31, 2004. Acquisition costs for the year ended December 31, 2005 decreased by 34.8% to $76.2 million from $116.9 million for the year ended December 31, 2004. The reduction is attributable to the change in premium mix, with life and annuity products and property and casualty insurance products typically having lower acquisition costs compared to property and casualty reinsurance products.

Interest expense for the three months ended December 31, 2005 decreased to $5.7 million from $9.7 million for the same period in 2004. Interest expense for the year ended December 31, 2005 decreased to $32.0 million from $33.6 million for the same period in 2004. The decrease principally relates to a lower average crediting rate on funds withheld balances.

General and administrative expenses for the three months ended December 31, 2005 were $14.1 million compared to $14.4 million for the same period in 2004. General and administrative expenses for the year ended December 31, 2005 were $56.2 million or 5.4% of net premiums earned compared to $49.0 million or 5.3% of net premiums earned for the year ended December 31, 2004.

Shareholders’ equity was $1,217.2 million at December 31, 2005, compared to $937.0 million at December 31, 2004. Book value per share at December 31, 2005 was $20.69 per share, compared to $20.45 at December 31, 2004. Annualized return on average shareholders’ equity for the year ended December 31, 2005 was 0.6%.

Max Re Capital Ltd., through its principal operating subsidiaries, Max Re Ltd., Max Insurance Europe Limited and Max Re Europe Limited, offers customized risk financing solutions to property and casualty insurers, life and health insurers and large corporations.

The above remarks about future expectations, plans and prospects for the Company are forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those suggested by such statements. For further information regarding cautionary statements and factors affecting future operating results, please refer to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2005 and other documents previously filed with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statement whether as a result of new information, future developments or otherwise.

Contact Information:
Keith S. Hynes	N. James Tees
Executive Vice President & CFO	Senior Vice President & Treasurer
441-296-8800	441-296-8800
keithh@maxre.bm	jimt@maxre.bm

MAX RE CAPITAL LTD.

CONSOLIDATED BALANCE SHEETS

(Expressed in thousands of United States Dollars, except per share and share amounts)

	December 31, 2005			December 31, 2004
	(Unaudited)
ASSETS
Cash and cash equivalents	$	314,031		$	239,188
Fixed maturities, available for sale at fair value		2,682,864			2,156,011
Alternative investments, at fair value		1,230,889			1,119,028
Accrued interest income		32,632			24,257
Premiums receivable		398,666			262,714
Losses and benefits recoverable from reinsurers		522,114			388,067
Funds withheld		16,932			17,599
Deferred acquisition costs		69,015			54,770
Prepaid reinsurance premiums		83,493			79,337
Other assets		23,001			26,384
Total assets	$	5,373,637		$	4,367,355
LIABILITIES
Property and casualty losses	$	2,006,032		$	1,455,099
Life and annuity benefits		854,224			666,101
Deposit liabilities		225,328			266,479
Funds withheld from reinsurers		311,387			301,100
Unearned property and casualty premiums		442,976			447,633
Reinsurance balances payable		90,781			50,258
Accounts payable and accrued expenses		75,728			93,694
Bank loan		150,000			150,000
Total liabilities		4,156,456			3,430,364
SHAREHOLDERS’ EQUITY
Preferred shares (par value $1.00) 20,000,000 shares authorized; no shares issued or outstanding		—			—
Common shares (par value $1.00) 200,000,000 shares authorized; 58,829,354 (2004 - 45,825,880) shares issued and outstanding		58,829			45,826
Additional paid-in capital		929,969			652,029
Loans receivable from common share sales		(465	)		(10,515	)
Unearned stock grant compensation		(14,574	)		(13,294	)
Accumulated other comprehensive income		4,981			22,227
Retained earnings		238,441			240,718
Total shareholders’ equity		1,217,181			936,991
Total liabilities and shareholders’ equity	$	5,373,637		$	4,367,355
Book Value Per Share	$	20.69		$	20.45

MAX RE CAPITAL LTD.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited)

(Expressed in thousands of United States Dollars, except shares and per share amounts)

	Three Months Ended December 31						Years Ended December 31
	2005			2004			2005			2004
REVENUES
Gross premiums written	$	257,188		$	139,568		$	1,246,031		$	1,043,601
Reinsurance premiums ceded		(68,346	)		(42,442	)		(213,068	)		(162,573	)
Net premiums written	$	188,842		$	97,126		$	1,032,963		$	881,028
Earned premiums	$	318,221		$	258,870		$	1,247,584		$	1,068,172
Earned premiums ceded		(61,480	)		(42,883	)		(208,179	)		(150,398	)
Net premiums earned		256,741			215,987			1,039,405			917,774
Net investment income		31,179			24,167			106,835			82,815
Net gains (losses) on alternative investments		(13,731	)		56,758			39,885			81,648
Net realized gains (losses) on sale of fixed maturities		(3,570	)		6,325			(743	)		10,447
Other income		1,047			1,226			4,635			4,890
Total revenues		271,666			304,463			1,190,017			1,097,574
LOSSES AND EXPENSES
Losses and benefits		247,029			163,390			1,018,937			764,296
Acquisition costs		16,309			29,848			76,224			116,862
Interest expense		5,673			9,727			32,025			33,644
General and administrative expenses		14,102			14,384			56,153			49,047
Total losses and expenses		283,113			217,349			1,183,339			963,849
NET INCOME (LOSS)		(11,447	)		87,114			6,678			133,725
Change in net unrealized appreciation of fixed maturities		(9,704	)		(3,535	)		(13,364	)		(7,140	)
Foreign currency translation adjustment		(568	)		3,401			(3,882	)		3,577
COMPREHENSIVE INCOME (LOSS)	$	(21,719	)	$	86,980		$	(10,568	)	$	130,162
Basic earnings (loss) per share	$	(0.20	)	$	1.91		$	0.14		$	2.93
Diluted earnings (loss) per share	$	(0.20	)	$	1.82		$	0.13		$	2.75
Diluted net operating earnings (loss) per share	$	(0.13	)	$	1.67		$	0.14		$	2.54
Weighted average shares outstanding - basic		56,133,014			45,753,252			48,685,954			45,703,410
Weighted average shares outstanding - diluted		56,133,014			48,183,656			52,556,015			48,568,769

MAX RE CAPITAL LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

(Expressed in thousands of United States Dollars)

	Years ended December 31,
	2005			2004
Preferred shares
Balance, beginning of period	$	—		$	—
Balance, end of period		—			—
Common shares
Balance, beginning of period		45,826			45,185
Issue of shares		13,338			910
Repurchase of shares		(335	)		(269	)
Balance, end of period		58,829			45,826
Additional paid-in capital
Balance, beginning of period		652,029			637,772
Issue of common shares		297,117			18,266
Direct equity offering expenses		(13,134	)		—
Stock option expense		982			572
Repurchase of shares		(7,025	)		(4,581	)
Balance, end of period		929,969			652,029
Loans receivable from common share sales
Balance, beginning of period		(10,515	)		(11,965	)
Loans repaid		10,050			1,450
Balance, end of period		(465	)		(10,515	)
Unearned stock grant compensation
Balance, beginning of period		(13,294	)		(4,032	)
Stock grants awarded		(11,294	)		(15,983	)
Amortization		10,014			6,721
Balance, end of period		(14,574	)		(13,294	)
Accumulated other comprehensive income (loss)
Balance, beginning of period		22,227			25,790
Holding gains (losses) on fixed maturities arising in period		(14,107	)		3,307
Net realized (gains) losses included in net income		743			(10,447	)
Currency translation adjustments		(3,882	)		3,577
Balance, end of period		4,981			22,227
Retained earnings
Balance, beginning of period		240,718			112,480
Net income		6,678			133,725
Dividends paid		(8,955	)		(5,487	)
Balance, end of period		238,441			240,718
Total shareholders’ equity	$	1,217,181		$	936,991

MAX RE CAPITAL LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(Expressed in thousands of United States Dollars)

	Years Ended December 31
	2005			2004
OPERATING ACTIVITIES
Net income	$	6,678		$	133,725
Adjustments to reconcile net income to net cash from operating activities:
Amortization of unearned stock based compensation		10,996			7,293
Amortization of premium on fixed maturities		9,293			9,186
Net realized (gains) losses on sale of fixed maturities		743			(10,447	)
Alternative investments		(112,352	)		(288,132	)
Accrued interest income		(8,375	)		(9,649	)
Premiums receivable		(135,952	)		126,679
Losses and benefits recoverable from reinsurers		(134,047	)		(114,356	)
Funds withheld		667			(17,543	)
Deferred acquisition costs		(14,245	)		32,346
Prepaid reinsurance premiums		(4,156	)		(11,994	)
Other assets		3,383			(356	)
Property and casualty losses		550,933			463,412
Life and annuity benefits		188,123			186,002
Funds withheld from reinsurers		10,287			87,617
Unearned property and casualty premiums		(4,657	)		(23,992	)
Reinsurance balances payable		40,523			(24,435	)
Accounts payable and accrued expenses		(17,966	)		52,302
Cash from operating activities		389,876			597,658
INVESTING ACTIVITIES
Purchase of fixed maturities		(1,789,339	)		(1,683,884	)
Sales of fixed maturities		1,181,516			1,100,398
Redemptions of fixed maturities		58,061			26,489
Cash used in investing activities		(549,762	)		(556,997	)
FINANCING ACTIVITIES
Net proceeds from issuance of common shares		286,027			3,193
Repurchase of common shares		(7,360	)		(4,850	)
Dividends		(8,955	)		(5,487	)
Additions to deposit liabilities		21,287			55,253
Payment of deposit liabilities		(62,438	)		(56,124	)
Notes and loans repaid		10,050			1,450
Cash from (used in) financing activities		238,611			(6,565	)
Effect of exchange rate on cash		(3,882	)		3,577
Net increase in cash and cash equivalents		74,843			37,673
Cash and cash equivalents, beginning of period		239,188			201,515
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	314,031		$	239,188

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Interest paid totaled $10,269 and $4,281 for the years ended December 31, 2005 and 2004, respectively.

MAX RE CAPITAL LTD.

SCHEDULE OF SUPPLEMENTAL DATA—DECEMBER 31, 2005

Year to Date Segment Information: (in 000’s US$)	Property & Casualty									Life & Annuity Reinsurance			Corporate			Consolidated
	Reinsurance			Insurance			Total
Gross premiums written	$	615,720		$	355,296		$	971,016		$	275,015		$	—		$	1,246,031
Reinsurance premiums ceded		(65,861	)		(145,738	)		(211,599	)		(1,469	)		—			(213,068	)
Net premiums written	$	549,859		$	209,558		$	759,417		$	273,546		$	—		$	1,032,963
Earned premiums	$	671,356		$	301,213		$	972,569		$	275,015		$	—		$	1,247,584
Earned premiums ceded		(78,381	)		(128,329	)		(206,710	)		(1,469	)		—			(208,179	)
Net premiums earned		592,975			172,884			765,859			273,546			—			1,039,405
Net investment income		—			—			—			—			106,835			106,835
Net gains on alternative investments		—			—			—			—			39,885			39,885
Net realized losses on sales of fixed maturities		—			—			—			—			(743	)		(743	)
Other income		—			—			—			—			4,635			4,635
Total revenues		592,975			172,884			765,859			273,546			150,612			1,190,017
Losses and benefits		532,267			175,458			707,725			311,212			—			1,018,937
Acquisition costs		73,617			110			73,727			2,497			—			76,224
Interest expense		—			—			—			—			32,025			32,025
General and administrative expenses		15,023			9,857			24,880			3,487			27,786			56,153
Total losses and expenses		620,907			185,425			806,332			317,196			59,811			1,183,339
Net income (loss)	$	(27,932	)	$	(12,541	)	$	(40,473	)	$	(43,650	)	$	90,801		$	6,678
Loss Ratio (a)		89.8	%		101.5	%		92.4	%
Combined Ratio (b)		104.7	%		107.3	%		105.3	%

(a) The loss ratio is calculated by dividing losses and benefits by net premiums earned.

(b) The combined ratio is calculated by dividing total losses and expenses by net premiums earned.

					Periodic Rate of Return
Selected Investment Return Data:	Fair Value*		Investment %’s		Last 3 Months		Last 12 Months		Last 60 months**
Cash and Fixed Maturities	$	2,996,895	70.9	%	0.59	%	3.83	%	5.62	%
Global Macro	$	100,765	2.4	%	1.95	%	3.13	%	9.53	%
Long / Short Equity		127,512	3.0	%	-3.21	%	3.37	%	4.37	%
Convertible Arbitrage		41,445	1.0	%	-0.49	%	-4.53	%	6.67	%
Diversified Arbitrage		179,952	4.3	%	3.45	%	10.47	%	9.35	%
Distressed Securities		194,499	4.6	%	1.02	%	10.83	%	17.68	%
Opportunistic		23,744	0.6	%	5.52	%	22.45	%	12.87	%
Emerging Markets		97,625	2.3	%	0.43	%	15.87	%	17.18	%
Fixed Income Arbitrage		22,937	0.5	%	-1.86	%	-8.62	%	4.43	%
Event-Driven Arbitrage		212,172	5.0	%	-0.07	%	7.50	%	11.34	%
Commodity Trading Advisers		78,782	1.9	%	0.51	%	10.22	%	5.55	%
Credit Long / Short		118,059	2.8	%	1.49	%	7.11	%	8.28	%
MDS		1,197,493	28.3	%	0.51	%	5.88	%	8.55	%
Reinsurance Private Equity		33,397	0.8	%	-36.38	%	-43.00	%	-8.48	%
Alternative Investments	$	1,230,889	29.1	%	-1.11	%	3.34	%	7.90	%
Total Investments	$	4,227,784	100.0	%	0.04	%	3.66	%	6.41	%

* Expressed in thousands of United States Dollars

** Annualized