American Financial Group has reported net earnings of $109m or, $1.10 diluted earnings per share, for the fourth quarter of 2011, compared to $133m, or $1.23 diluted earnings per share, for the same period in 2010.

Investment income increased to $325m for the fourth quarter of 2011, compared to $306m for the same period in the prior year.

The P&C specialty insurance operations generated underwriting profit of $90m, compared to $94m for the same period a year ago.

AFG co-CEOs Carl Lindner and Craig Lindner jointly said that company has produced $100 billion – the second costliest on record – and challenging economic for the industry in 2011.

"We continued to acquire shares of our common stock throughout the year, on average, at approximately 84% of year-end book value. We are confident in the Company’s financial strength and liquidity, with parent company cash of $415 million and excess capital of approximately $785 million at December 31, 2011 added Lindner.