XL Capital, a provider of insurance and reinsurance coverage, has reported net income available to ordinary shareholders of $211.9 million for the first quarter ended March 31, 2008, compared with $549.7 million for the same quarter of 2007.

According to the company, the reduction in net income of $337.8 million is due primarily to – a decrease in net income from investment affiliates of $107.1 million; net realized losses on investments of $102.3 million, as compared to a gain of $9.3 million in the first quarter of 2007; a decrease in net income from financial operating affiliates of $39.6 million.

Annualized return on ordinary shareholders’ equity was 9.9% and 22.7% for the first quarter of 2008 and 2007, respectively. Return on ordinary shareholders’ equity, based on net income excluding net realized gains and losses for the period was 12.9% as against 22.3% for comparable period in 2007.

Brian O’Hara, president, CEO and acting chairman of XL Capital, said: Although XL is steadily navigating through some extremely difficult global credit market conditions, which is reflected in our lower investment performance relative to the outstanding results in the prior year quarter, we have still achieved another solid performance from our insurance, reinsurance, and life operations.