##### 



As filed with the Securities and Exchange Commission on
August 9, 2005








SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549





Form 10-Q


QUARTERLY REPORT UNDER SECTION 13 OR 15(d)


OF THE SECURITIES EXCHANGE ACT OF 1934


|                                         |  |                                    
|---------------------------------------- |  | -----------------------------------
|For the Quarter Ended:
    June 30, 2005 |  | Commission File Number:
    1-16535




Odyssey Re Holdings Corp.


(Exact Name of Registrant as Specified in its Charter)


|                                                                   |  |                                                              |  |                                            
|------------------------------------------------------------------ |  | ------------------------------------------------------------ |  | -------------------------------------------
|Delaware                                                           |  | 6719                                                         |  | 52-2301683                                 
|(State or Other Jurisdiction Of
    Incorporation or Organization) |  | (Primary Standard Industrial
    Classification Code Number) |  | (I.R.S. Employer
    Identification Number)

Odyssey Re Holdings Corp.


300 First Stamford Place, Stamford, CT 06902


(203) 977-8000


(Address, including zip code, and telephone number,


including area code, of registrants principal executive
offices)


Donald L. Smith, Esq.


Senior Vice President, General Counsel and Corporate
Secretary


Odyssey Re Holdings Corp.


300 First Stamford Place, Stamford, CT 06902


(203) 977-8000


(Name, address, including zip code, and telephone number,


including area code, of agent for service)


þ o


þ o




|                             |  |  |  |                                                |            | 
|---------------------------- |  |  |  | ---------------------------------------------- | ---------- | 
|Class                        |  |  |  | Number of Shares Outstanding at August 1, 2005
|                             |  |  |  |                                               
|Common Stock, $.01 Par Value |  |  |  |                                                | 64,865,680 | 









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##### 



TABLE OF CONTENTS


ODYSSEY RE HOLDINGS CORP.


INDEX TO FORM 10-Q


|                                 |  |                                                                                                                                              |  |  |    | 
|-------------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------- |  |  | -- | 
|PART I
    FINANCIAL INFORMATION
|Item 1.                          |  | Financial Statements                                                                                                                         |  |  | 2  | 
|                                 |  | Consolidated Balance Sheets as of June 30, 2005 (unaudited)
    and December 31, 2004                                                        |  |  | 2  | 
|                                 |  | Consolidated Statements of Operations and Comprehensive Income
    for the six and three months ended June 30, 2005 and 2004
    (unaudited) |  |  | 3  | 
|                                 |  | Consolidated Statements of Stockholders Equity for the six
    months ended June 30, 2005 and 2004 (unaudited)                              |  |  | 4  | 
|                                 |  | Consolidated Statements of Cash Flows for the six months ended
    June 30, 2005 and 2004 (unaudited)                                        |  |  | 5  | 
|                                 |  | Notes to Consolidated Financial Statements (unaudited)                                                                                       |  |  | 6  | 
|Item 2.                          |  | Managements Discussion and Analysis of Financial
    Condition and Results of Operations                                                    |  |  | 23 | 
|Item 3.                          |  | Quantitative and Qualitative Disclosures About Market Risk                                                                                   |  |  | 37 | 
|Item 4.                          |  | Controls and Procedures                                                                                                                      |  |  | 40 | 
|PART II
    OTHER INFORMATION   
|Item 1.                          |  | Legal Proceedings                                                                                                                            |  |  | 41 | 
|Item 2.                          |  | Unregistered Sales of Equity Securities and Use of
    Proceeds                                                                              |  |  | 41 | 
|Item 3.                          |  | Defaults Upon Senior Securities                                                                                                              |  |  | 41 | 
|Item 4.                          |  | Submission of Matters to a Vote of Security Holders                                                                                          |  |  | 41 | 
|Item 5.                          |  | Other Information  Forward Looking Statements                                                                                               |  |  | 42 | 
|Item 6.                          |  | Exhibits                                                                                                                                     |  |  | 43 | 
|                                 |  | Signatures                                                                                                                                   |  |  | 44 | 

1



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##### 






PART I  FINANCIAL INFORMATION





PART I 
Item 1.Financial
Statements


ODYSSEY RE HOLDINGS CORP.





CONSOLIDATED BALANCE SHEETS


JUNE 30, 2005 (UNAUDITED) AND DECEMBER 31,
2004


(In thousands, except share amounts)


|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |           |           |           |         |           | 
|---------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------- | ------------------------------------------ | --------- | ------------ | --------- | --------- | --------- | ------- | --------- | 
|                                                                                               |                                                                                                     | June 30,                                                                    |                                            |           | December 31, |          
|                                                                                               |                                                                                                     | 2005                                                                        |                                            |           | 2004         |          
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|ASSETS                                                                                        
|Investments and cash:                                                                          |                                                                                                     |                                                                             |                                            |           |              |           |           |          
|                                                                                               | Fixed income securities, at fair value (amortized cost
    $2,576,346 and $2,478,614, respectively) |                                                                             | $                                          | 2,667,729 |              |           | $         | 2,505,630 |        
|                                                                                               | Equity securities:                                                                                  |                                                                             |                                            |           |              |           |           |           |        
|                                                                                               |                                                                                                     | Common stocks, at fair value (cost $518,640 and $435,279,
    respectively) |                                            |           | 575,124      |           |           |           | 453,580 |          
|                                                                                               |                                                                                                     | Common stocks, at equity                                                    |                                            |           | 467,740      |           |           |           | 402,555 |          
|                                                                                               | Short-term investments, at cost which approximates fair value                                       |                                                                             |                                            | 199,004   |              |           |           | 213,403   |        
|                                                                                               | Other invested assets                                                                               |                                                                             |                                            | 222,444   |              |           |           | 149,075   |        
|                                                                                               | Cash and cash equivalents                                                                           |                                                                             |                                            | 1,191,088 |              |           |           | 1,150,748 |        
|                                                                                               | Cash collateral for borrowed securities                                                             |                                                                             |                                            | 239,577   |              |           |           | 176,518   |        
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                               |                                                                                                     |                                                                             | Total investments and cash                 |           |              | 5,562,706 |           |           |         | 5,051,509 | 
|Investment income due and accrued                                                              |                                                                                                     |                                                                             | 42,076                                     |           |              |           | 39,592    |          
|Premiums receivable                                                                            |                                                                                                     |                                                                             | 526,552                                    |           |              |           | 550,198   |          
|Reinsurance recoverables on loss payments                                                      |                                                                                                     |                                                                             | 138,641                                    |           |              |           | 89,912    |          
|Reinsurance recoverables on unpaid losses                                                      |                                                                                                     |                                                                             | 1,061,073                                  |           |              |           | 1,092,082 |          
|Prepaid reinsurance premiums                                                                   |                                                                                                     |                                                                             | 83,647                                     |           |              |           | 93,774    |          
|Funds held by ceding insurers                                                                  |                                                                                                     |                                                                             | 176,181                                    |           |              |           | 192,346   |          
|Deferred acquisition costs                                                                     |                                                                                                     |                                                                             | 171,833                                    |           |              |           | 171,083   |          
|Federal and foreign income taxes                                                               |                                                                                                     |                                                                             | 88,788                                     |           |              |           | 102,298   |          
|Other assets                                                                                   |                                                                                                     |                                                                             | 80,713                                     |           |              |           | 138,016   |          
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                               |                                                                                                     |                                                                             | Total assets                               |           | $            | 7,932,210 |           |           | $       | 7,520,810 | 
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                              
|LIABILITIES                                                                                   
|Unpaid losses and loss adjustment expenses                                                     |                                                                                                     | $                                                                           | 4,388,062                                  |           |              | $         | 4,228,021 |          
|Unearned premiums                                                                              |                                                                                                     |                                                                             | 829,132                                    |           |              |           | 832,305   |          
|Reinsurance balances payable                                                                   |                                                                                                     |                                                                             | 136,028                                    |           |              |           | 122,182   |          
|Funds held under reinsurance contracts                                                         |                                                                                                     |                                                                             | 178,542                                    |           |              |           | 179,867   |          
|Debt obligations                                                                               |                                                                                                     |                                                                             | 481,573                                    |           |              |           | 376,040   |          
|Obligations to return borrowed securities                                                      |                                                                                                     |                                                                             | 89,801                                     |           |              |           | 56,191    |          
|Other liabilities                                                                              |                                                                                                     |                                                                             | 115,207                                    |           |              |           | 140,704   |          
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                               |                                                                                                     |                                                                             | Total liabilities                          |           |              | 6,218,345 |           |           |         | 5,935,310 | 
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                              
|STOCKHOLDERS EQUITY                                                                          
|Preferred stock, $0.01 par value; 200,000,000 shares
    authorized; 0 shares issued           |                                                                                                     |                                                                             |                                           |           |              |           |          |          
|Common stock, $0.01 par value; 500,000,000 shares
    authorized;
    65,142,857 shares issued |                                                                                                     |                                                                             | 651                                        |           |              |           | 651       |          
|Additional paid-in capital                                                                     |                                                                                                     |                                                                             | 793,973                                    |           |              |           | 794,055   |          
|Treasury stock, at cost (277,177 and 387,879 shares,
    respectively)                         |                                                                                                     |                                                                             | (6,701                                     | )         |              |           | (9,426    | )        
|Unearned compensation                                                                          |                                                                                                     |                                                                             | (6,196                                     | )         |              |           | (4,977    | )        
|Accumulated other comprehensive income, net of deferred income
    taxes                       |                                                                                                     |                                                                             | 188,571                                    |           |              |           | 136,849   |          
|Retained earnings                                                                              |                                                                                                     |                                                                             | 743,567                                    |           |              |           | 668,348   |          
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                               |                                                                                                     |                                                                             | Total stockholders equity                 |           |              | 1,713,865 |           |           |         | 1,585,500 | 
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          
|                                                                                               |                                                                                                     |                                                                             | Total liabilities and stockholders equity |           | $            | 7,932,210 |           |           | $       | 7,520,810 | 
|                                                                                               |                                                                                                     |                                                                             |                                            |           |              |          



2



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##### 



ODYSSEY RE HOLDINGS CORP.





CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME


SIX AND THREE MONTHS ENDED JUNE 30, 2005 AND 2004
(UNAUDITED)


(In thousands, except share and per share amounts)


|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |         |  
|--------------------------------------------------- | ---------------------------------------------- | ------------------------- | ---------- | --------- | --------------------------- | - | ---------- | --------- | - | - | ---------- | ------- | - | - | ---------- | ------- | -
|                                                    |                                                | Six Months Ended June 30, |            |           | Three Months Ended June 30, |  
|                                                    |                                                |                           |            |           |                             |  
|                                                    |                                                | 2005                      |            |           | 2004                        |   |            | 2005      |   |   | 2004       |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|REVENUES                                            |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Gross premiums written                              |                                                | $                         | 1,283,468  |           |                             | $ | 1,241,459  |           |   | $ | 601,901    |         |   | $ | 611,976    |        
|Ceded premiums written                              |                                                |                           | 130,170    |           |                             |   | 138,209    |           |   |   | 64,178     |         |   |   | 61,965     |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|                                                    | Net premiums written                           |                           |            | 1,153,298 |                             |   |            | 1,103,250 |   |   |            | 537,723 |   |   |            | 550,011 |  
|(Increase) decrease in unearned premiums            |                                                |                           | (11,288    | )         |                             |   | 23,125     |           |   |   | 36,019     |         |   |   | 30,103     |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|                                                    | Net premiums earned                            |                           | $          | 1,142,010 |                             |   | $          | 1,126,375 |   |   | $          | 573,742 |   |   | $          | 580,114 |  
|Net investment income                               |                                                |                           | 115,162    |           |                             |   | 70,567     |           |   |   | 50,047     |         |   |   | 35,105     |        
|Net realized investment gains                       |                                                |                           | 7,943      |           |                             |   | 67,256     |           |   |   | 7,792      |         |   |   | 32,417     |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|                                                    | Total revenues                                 |                           |            | 1,265,115 |                             |   |            | 1,264,198 |   |   |            | 631,581 |   |   |            | 647,636 |  
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|EXPENSES                                            |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Losses and loss adjustment expenses                 |                                                |                           | 806,299    |           |                             |   | 747,318    |           |   |   | 392,220    |         |   |   | 383,761    |        
|Acquisition costs                                   |                                                |                           | 241,596    |           |                             |   | 257,489    |           |   |   | 123,076    |         |   |   | 132,008    |        
|Other underwriting expenses                         |                                                |                           | 67,365     |           |                             |   | 63,880     |           |   |   | 34,959     |         |   |   | 33,971     |        
|Other expense, net                                  |                                                |                           | 14,265     |           |                             |   | 4,956      |           |   |   | 6,038      |         |   |   | 2,596      |        
|Interest expense                                    |                                                |                           | 13,917     |           |                             |   | 12,799     |           |   |   | 7,511      |         |   |   | 6,405      |        
|Loss on early extinguishment of debt                |                                                |                           | 2,060      |           |                             |   |           |           |   |   | 2,060      |         |   |   |           |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|                                                    | Total expenses                                 |                           |            | 1,145,502 |                             |   |            | 1,086,442 |   |   |            | 565,864 |   |   |            | 558,741 |  
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|Income before income taxes                          |                                                |                           | 119,613    |           |                             |   | 177,756    |           |   |   | 65,717     |         |   |   | 88,895     |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|Federal and foreign income tax provision (benefit): |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|                                                    | Current                                        |                           |            | 53,138    |                             |   |            | 61,013    |   |   |            | 24,352  |   |   |            | 35,903  |  
|                                                    | Deferred                                       |                           |            | (12,796   | )                           |   |            | (1,263    | ) |   |            | (1,749  | ) |   |            | (6,059  | )
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|                                                    | Total federal and foreign income tax provision |                           |            | 40,342    |                             |   |            | 59,750    |   |   |            | 22,603  |   |   |            | 29,844  |  
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|NET INCOME                                          |                                                | $                         | 79,271     |           |                             | $ | 118,006    |           |   | $ | 43,114     |         |   | $ | 59,051     |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|BASIC                                               |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Weighted average shares outstanding                 |                                                |                           | 64,317,054 |           |                             |   | 64,385,021 |           |   |   | 64,352,281 |         |   |   | 64,311,432 |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|Basic earnings per common share                     |                                                | $                         | 1.23       |           |                             | $ | 1.83       |           |   | $ | 0.67       |         |   | $ | 0.92       |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|DILUTED                                             |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Weighted average common shares outstanding          |                                                |                           | 69,874,831 |           |                             |   | 70,384,802 |           |   |   | 69,765,394 |         |   |   | 70,330,771 |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|Diluted earnings per common share                   |                                                | $                         | 1.16       |           |                             | $ | 1.70       |           |   | $ | 0.63       |         |   | $ | 0.85       |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|DIVIDENDS                                           |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Dividends declared per common share                 |                                                | $                         | 0.063      |           |                             | $ | 0.063      |           |   | $ | 0.031      |         |   | $ | 0.031      |        
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|COMPREHENSIVE INCOME (LOSS)                         |                                                |                           |            |           |                             |   |            |           |   |   |            |         |   |   |            |        
|Net income                                          |                                                | $                         | 79,271     |           |                             | $ | 118,006    |           |   | $ | 43,114     |         |   | $ | 59,051     |        
|Other comprehensive income (loss) net of tax        |                                                |                           | 51,722     |           |                             |   | (102,848   | )         |   |   | 71,532     |         |   |   | (97,617    | )      
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        
|Comprehensive income (loss)                         |                                                | $                         | 130,993    |           |                             | $ | 15,158     |           |   | $ | 114,646    |         |   | $ | (38,566    | )      
|                                                    |                                                |                           |            |           |                             |   |            |           |   |   |            |        



3



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##### 



ODYSSEY RE HOLDINGS CORP.





CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY


SIX MONTHS ENDED JUNE 30, 2005 AND 2004 (UNAUDITED)


(In thousands, except share amounts)


|                                                                                    |  |                           |            |   |      |   |            |  
|----------------------------------------------------------------------------------- |  | ------------------------- | ---------- | - | ---- | - | ---------- | -
|                                                                                    |  | Six Months Ended June 30, |           
|                                                                                    |  |                           |           
|                                                                                    |  | 2005                      |            |   | 2004 |  
|                                                                                    |  |                           |            |   |      |  
|COMMON STOCK                                                                        |  |                           |            |   |      |   |            |  
|Balance, beginning and end of period                                                |  | $                         | 651        |   |      | $ | 651        |  
|                                                                                    |  |                           |            |   |      |  
|ADDITIONAL PAID-IN CAPITAL                                                          |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | 794,055    |   |      |   | 793,586    |  
|Net (decrease) increase during the period                                           |  |                           | (82        | ) |      |   | 477        |  
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | 793,973    |   |      |   | 794,063    |  
|                                                                                    |  |                           |            |   |      |  
|TREASURY STOCK                                                                      |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | (9,426     | ) |      |   | (2,549     | )
|Purchases during the period                                                         |  |                           | (557       | ) |      |   | (10,091    | )
|Reissuance during the period                                                        |  |                           | 3,282      |   |      |   | 3,978      |  
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | (6,701     | ) |      |   | (8,662     | )
|                                                                                    |  |                           |            |   |      |  
|UNEARNED COMPENSATION                                                               |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | (4,977     | ) |      |   | (3,439     | )
|Issuance of restricted stock during the period                                      |  |                           | (2,578     | ) |      |   | (4,328     | )
|Forfeitures of restricted stock during the period                                   |  |                           | 439        |   |      |   |           |  
|Amortization during the period                                                      |  |                           | 920        |   |      |   | 859        |  
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | (6,196     | ) |      |   | (6,908     | )
|                                                                                    |  |                           |            |   |      |  
|ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS), NET OF
    DEFERRED INCOME TAXES     |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | 136,849    |   |      |   | 112,430    |  
|Unrealized net gains (losses) on securities, net of
    reclassification adjustment |  |                           | 86,541     |   |      |   | (87,805    | )
|Foreign currency translation adjustments                                            |  |                           | (34,819    | ) |      |   | (15,043    | )
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | 188,571    |   |      |   | 9,582      |  
|                                                                                    |  |                           |            |   |      |  
|RETAINED EARNINGS                                                                   |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | 668,348    |   |      |   | 489,556    |  
|Net income                                                                          |  |                           | 79,271     |   |      |   | 118,006    |  
|Dividends to stockholders                                                           |  |                           | (4,052     | ) |      |   | (4,058     | )
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | 743,567    |   |      |   | 603,504    |  
|                                                                                    |  |                           |            |   |      |  
|TOTAL STOCKHOLDERS EQUITY                                                          |  | $                         | 1,713,865  |   |      | $ | 1,392,230  |  
|                                                                                    |  |                           |            |   |      |  
|COMMON SHARES OUTSTANDING                                                           |  |                           |            |   |      |   |            |  
|Balance, beginning of period                                                        |  |                           | 64,754,978 |   |      |   | 64,996,166 |  
|Net treasury shares issued (acquired) during the period                             |  |                           | 110,702    |   |      |   | (212,340   | )
|                                                                                    |  |                           |            |   |      |  
|Balance, end of period                                                              |  |                           | 64,865,680 |   |      |   | 64,783,826 |  
|                                                                                    |  |                           |            |   |      |  



4



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##### 



ODYSSEY RE HOLDINGS CORP.





CONSOLIDATED STATEMENTS OF CASH FLOWS


SIX MONTHS ENDED JUNE 30, 2005 AND 2004 (UNAUDITED)


(In thousands)


|                                                                                      |                                            |                                                     |            |         |           |   |            |         |            |  
|------------------------------------------------------------------------------------- | ------------------------------------------ | --------------------------------------------------- | ---------- | ------- | --------- | - | ---------- | ------- | ---------- | -
|                                                                                      |                                            | Six Months Ended June 30,                           |           
|                                                                                      |                                            |                                                     |           
|                                                                                      |                                            | 2005                                                |            |         | 2004      |  
|                                                                                      |                                            |                                                     |            |         |           |  
|OPERATING ACTIVITIES                                                                  |                                            |                                                     |            |         |           |   |            |        
|Net income                                                                            |                                            | $                                                   | 79,271     |         |           | $ | 118,006    |        
|Adjustments to reconcile net income to net cash provided by
    operating activities: |                                            |                                                     |            |         |           |   |            |        
|                                                                                      | Premiums receivable and funds held, net    |                                                     |            | 3,601   |           |   |            | (29,823 | )         
|                                                                                      | Unearned premiums                          |                                                     |            | 6,954   |           |   |            | (18,776 | )         
|                                                                                      | Unpaid losses and loss adjustment expenses |                                                     |            | 191,049 |           |   |            | 273,279 |           
|                                                                                      | Federal and foreign income taxes           |                                                     |            | (13,743 | )         |   |            | 4,579   |           
|                                                                                      | Other assets and liabilities, net          |                                                     |            | (27,859 | )         |   |            | (39,862 | )         
|                                                                                      | Deferred acquisition costs                 |                                                     |            | (750    | )         |   |            | 1,010   |           
|                                                                                      | Net realized investment gains              |                                                     |            | (7,944  | )         |   |            | (67,256 | )         
|                                                                                      | Bond discount amortization, net            |                                                     |            | (3,723  | )         |   |            | (6,740  | )         
|                                                                                      | Loss on early extinguishment of debt       |                                                     |            | 2,060   |           |   |            |        |           
|                                                                                      |                                            |                                                     |            |         |           |  
|                                                                                      |                                            | Net cash provided by operating activities           |            |         | 228,916   |   |            |         | 234,417    |  
|                                                                                      |                                            |                                                     |            |         |           |  
|INVESTING ACTIVITIES                                                                  |                                            |                                                     |            |         |           |   |            |        
|Maturities of fixed income securities                                                 |                                            |                                                     | 4,931      |         |           |   | 3,542      |        
|Sales of fixed income securities                                                      |                                            |                                                     | 1,117,598  |         |           |   | 892,172    |        
|Purchases of fixed income securities                                                  |                                            |                                                     | (1,164,816 | )       |           |   | (1,873,284 | )      
|Sales of equity securities                                                            |                                            |                                                     | 42,671     |         |           |   | 131,454    |        
|Purchases of equity securities                                                        |                                            |                                                     | (166,958   | )       |           |   | (115,783   | )      
|Purchases of other invested assets                                                    |                                            |                                                     | (76,124    | )       |           |   | (164,423   | )      
|Cash collateral for borrowed securities                                               |                                            |                                                     | (63,059    | )       |           |   |           |        
|Obligation to return borrowed securities                                              |                                            |                                                     | 37,104     |         |           |   |           |        
|Decrease in short-term investments                                                    |                                            |                                                     | 3,054      |         |           |   | 16,505     |        
|                                                                                      |                                            |                                                     |            |         |           |  
|                                                                                      |                                            | Net cash used in investing activities               |            |         | (265,599  | ) |            |         | (1,109,817 | )
|                                                                                      |                                            |                                                     |            |         |           |  
|FINANCING ACTIVITIES                                                                  |                                            |                                                     |            |         |           |   |            |        
|Dividends                                                                             |                                            |                                                     | (4,052     | )       |           |   | (4,058     | )      
|Purchase of treasury stock                                                            |                                            |                                                     | (557       | )       |           |   | (10,091    | )      
|Net proceeds from debt issuance                                                       |                                            |                                                     | 123,169    |         |           |   |           |        
|Retirement of convertible debt                                                        |                                            |                                                     | (20,358    | )       |           |   |           |        
|                                                                                      |                                            |                                                     |            |         |           |  
|                                                                                      |                                            | Net cash provided by (used in) financing activities |            |         | 98,202    |   |            |         | (14,149    | )
|                                                                                      |                                            |                                                     |            |         |           |  
|Effect of exchange rate changes on cash and cash equivalents                          |                                            |                                                     | (21,179    | )       |           |   | (3,094     | )      
|                                                                                      |                                            |                                                     |            |         |           |  
|Increase (decrease) in cash and cash equivalents                                      |                                            |                                                     | 40,340     |         |           |   | (892,643   | )      
|Cash and cash equivalents, beginning of period                                        |                                            |                                                     | 1,150,748  |         |           |   | 1,588,659  |        
|                                                                                      |                                            |                                                     |            |         |           |  
|                                                                                      |                                            | Cash and cash equivalents, end of period            |            | $       | 1,191,088 |   |            | $       | 696,016    |  
|                                                                                      |                                            |                                                     |            |         |           |  



5



---



##### 



ODYSSEY RE HOLDINGS CORP.





NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




|   |                                       
|-- | --------------------------------------
|1. | Organization and Basis of Presentation









|                                                  |  |                  |        |  |                    |   |      |      |  |   |       |  |  |   |     | 
|------------------------------------------------- |  | ---------------- | ------ |  | ------------------ | - | ---- | ---- |  | - | ----- |  |  | - | --- | 
|                                                  |  | Six Months Ended |        |  | Three Months Ended |  
|                                                  |  | June 30,         |        |  | June 30,           |  
|                                                  |  |                  |        |  |                    |  
|                                                  |  | 2005             |        |  | 2004               |   |      | 2005 |  |   | 2004  | 
|                                                  |  |                  |        |  |                    |   |      |      |  |   |       | 
|Equity in net investment income of HWIC Asia      |  | $                | 769    |  |                    | $ | (100 | )    |  | $ | 1,008 |  |  | $ | 81  | 
|Equity in net realized capital gains of HWIC Asia |  |                  | 26,680 |  |                    |   | 288  |      |  |   | 1,380 |  |  |   | 22  | 
|                                                  |  |                  |        |  |                    |   |      |      |  |   |       | 
|Equity in net income of HWIC Asia                 |  | $                | 27,449 |  |                    | $ | 188  |      |  | $ | 2,388 |  |  | $ | 103 | 
|                                                  |  |                  |        |  |                    |   |      |      |  |   |       | 

6



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                       
|-- | --------------------------------------
|2. | Accumulated Other Comprehensive Income



|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |   |  |   |         |  
|-------------------------------------------------------------------------- |  | ---------------- | ------- | - | ------------------ | - | -------- | ---- |  | - | ------- | - |  | - | ------- | -
|                                                                           |  | Six Months Ended |         |   | Three Months Ended |  
|                                                                           |  | June 30,         |         |   | June 30,           |  
|                                                                           |  |                  |         |   |                    |  
|                                                                           |  | 2005             |         |   | 2004               |   |          | 2005 |  |   | 2004    |  
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Beginning balance of accumulated other comprehensive income                |  | $                | 136,849 |   |                    | $ | 112,430  |      |  | $ | 117,039 |   |  | $ | 107,199 |  
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|                                                                          
|Beginning balance of unrealized net gains on securities                    |  |                  | 84,412  |   |                    |   | 73,756   |      |  |   | 75,249  |   |  |   | 74,599  |  
|Ending balance of unrealized net gains (losses) on securities              |  |                  | 170,953 |   |                    |   | (14,049  | )    |  |   | 170,953 |   |  |   | (14,049 | )
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Current period change in unrealized net gains (losses) on
    securities   |  |                  | 86,541  |   |                    |   | (87,805  | )    |  |   | 95,704  |   |  |   | (88,648 | )
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|                                                                          
|Beginning balance of foreign currency translation adjustments              |  |                  | 53,662  |   |                    |   | 39,896   |      |  |   | 43,015  |   |  |   | 33,822  |  
|Ending balance of foreign currency translation adjustments                 |  |                  | 18,843  |   |                    |   | 24,853   |      |  |   | 18,843  |   |  |   | 24,853  |  
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Current period change in foreign currency translation adjustments          |  |                  | (34,819 | ) |                    |   | (15,043  | )    |  |   | (24,172 | ) |  |   | (8,969  | )
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|                                                                          
|Beginning balance of minimum pension liability                             |  |                  | (1,225  | ) |                    |   | (1,222   | )    |  |   | (1,225  | ) |  |   | (1,222  | )
|Ending balance of minimum pension liability                                |  |                  | (1,225  | ) |                    |   | (1,222   | )    |  |   | (1,225  | ) |  |   | (1,222  | )
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Current period change of minimum pension liability                         |  |                  |        |   |                    |   |         |      |  |   |        |   |  |   |        |  
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Current period change in accumulated other comprehensive income
    (loss) |  |                  | 51,722  |   |                    |   | (102,848 | )    |  |   | 71,532  |   |  |   | (97,617 | )
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  
|Ending balance of accumulated other comprehensive income                   |  | $                | 188,571 |   |                    | $ | 9,582    |      |  | $ | 188,571 |   |  | $ | 9,582   |  
|                                                                           |  |                  |         |   |                    |   |          |      |  |   |         |  

7



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|------------------------------------------------------------------------- |  | ---------------- | ------- | - | ------------------ | - | -------- | ---- |  | - | ------- | - |  | - | -------- | -
|                                                                          |  | Six Months Ended |         |   | Three Months Ended |  
|                                                                          |  | June 30,         |         |   | June 30,           |  
|                                                                          |  |                  |         |   |                    |  
|                                                                          |  | 2005             |         |   | 2004               |   |          | 2005 |  |   | 2004    |  
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Net income                                                                |  | $                | 79,271  |   |                    | $ | 118,006  |      |  | $ | 43,114  |   |  | $ | 59,051   |  
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Other comprehensive income (loss), before tax:                            |  |                  |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Unrealized net gains (losses) on securities arising during the
    period |  |                  | 130,504 |   |                    |   | (174,653 | )    |  |   | 146,588 |   |  |   | (196,135 | )
|Reclassification adjustment for realized gains included in net
    income |  |                  | 2,636   |   |                    |   | 39,568   |      |  |   | 649     |   |  |   | 59,753   |  
|Foreign currency translation adjustments                                  |  |                  | (53,568 | ) |                    |   | (23,143  | )    |  |   | (37,188 | ) |  |   | (13,798  | )
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Other comprehensive income (loss), before tax                             |  |                  | 79,572  |   |                    |   | (158,228 | )    |  |   | 110,049 |   |  |   | (150,180 | )
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Tax (expense) benefit:                                                    |  |                  |         |   |                    |   |          |      |  |   |         |   |  |   |          |  
|Unrealized net (gains) losses on securities arising during
    the period |  |                  | (45,676 | ) |                    |   | 61,129   |      |  |   | (51,305 | ) |  |   | 68,648   |  
|Reclassification adjustment for realized gains included in net
    income |  |                  | (923    | ) |                    |   | (13,849  | )    |  |   | (228    | ) |  |   | (20,914  | )
|Foreign currency translation adjustments                                  |  |                  | 18,749  |   |                    |   | 8,100    |      |  |   | 13,016  |   |  |   | 4,829    |  
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Total tax (expense) benefit                                               |  |                  | (27,850 | ) |                    |   | 55,380   |      |  |   | (38,517 | ) |  |   | 52,563   |  
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Other comprehensive income (loss), net of tax                             |  |                  | 51,722  |   |                    |   | (102,848 | )    |  |   | 71,532  |   |  |   | (97,617  | )
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  
|Comprehensive income (loss)                                               |  | $                | 130,993 |   |                    | $ | 15,158   |      |  | $ | 114,646 |   |  | $ | (38,566  | )
|                                                                          |  |                  |         |   |                    |   |          |      |  |   |         |  



8



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                   
|-- | ------------------
|3. | Earnings Per Share



|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |      |  |   |            |      | 
|----------------------------------------------------------------------- | ------- | ---------------- | ---------- | ---- | ------------------ | - | ---------- | ---- |  | - | ---------- | ---- |  | - | ---------- | ---- | 
|                                                                        |         | Six Months Ended |            |      | Three Months Ended |  
|                                                                        |         | June 30,         |            |      | June 30,           |  
|                                                                        |         |                  |            |      |                    |  
|                                                                        |         | 2005             |            |      | 2004               |   |            | 2005 |  |   | 2004       |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Net income available to stockholders  basic                            |         | $                | 79,271     |      |                    | $ | 118,006    |      |  | $ | 43,114     |      |  | $ | 59,051     |     
|Effect of 4.375% convertible senior debentures interest,
    net of tax |         |                  | 1,533      |      |                    |   | 1,573      |      |  |   | 751        |      |  |   | 791        |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Income available to common stockholders  diluted                       |         | $                | 80,804     |      |                    | $ | 119,579    |      |  | $ | 43,865     |      |  | $ | 59,842     |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Weighted average common shares outstanding  basic                      |         |                  | 64,317,054 |      |                    |   | 64,385,021 |      |  |   | 64,352,281 |      |  |   | 64,311,432 |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Effect of dilutive shares:                                              |         |                  |            |      |                    |   |            |      |  |   |            |      |  |   |            |     
|4.375% convertible senior debentures                                    |         |                  | 5,039,483  |      |                    |   | 5,169,175  |      |  |   | 4,915,863  |      |  |   | 5,169,175  |     
|Stock options                                                           |         |                  | 186,085    |      |                    |   | 193,464    |      |  |   | 159,561    |      |  |   | 188,648    |     
|Restricted stock                                                        |         |                  | 332,209    |      |                    |   | 637,142    |      |  |   | 337,689    |      |  |   | 661,516    |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Total effect of dilutive shares                                         |         |                  | 5,557,777  |      |                    |   | 5,999,781  |      |  |   | 5,413,113  |      |  |   | 6,019,339  |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Weighted average common shares outstanding  diluted                    |         |                  | 69,874,831 |      |                    |   | 70,384,802 |      |  |   | 69,765,394 |      |  |   | 70,330,771 |     
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|Earnings per common share:                                              |         |                  |            |      |                    |   |            |      |  |   |            |      |  |   |            |     
|                                                                        | Basic   |                  | $          | 1.23 |                    |   | $          | 1.83 |  |   | $          | 0.67 |  |   | $          | 0.92 | 
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     
|                                                                        | Diluted |                  | $          | 1.16 |                    |   | $          | 1.70 |  |   | $          | 0.63 |  |   | $          | 0.85 | 
|                                                                        |         |                  |            |      |                    |   |            |      |  |   |            |     



9



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                         
|-- | ------------------------
|4. | Stock Based Compensation



|                             |                                                                                                                                            |                  |        |      |                    |   |         |      |      |   |        |      |      |   |        |      |      | 
|---------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------ | ---------------- | ------ | ---- | ------------------ | - | ------- | ---- | ---- | - | ------ | ---- | ---- | - | ------ | ---- | ---- | 
|                             |                                                                                                                                            | Six Months Ended |        |      | Three Months Ended |  
|                             |                                                                                                                                            | June 30,         |        |      | June 30,           |  
|                             |                                                                                                                                            |                  |        |      |                    |  
|                             |                                                                                                                                            | 2005             |        |      | 2004               |   |         | 2005 |      |   | 2004   |     
|                             |                                                                                                                                            |                  |        |      |                    |   |         |      |      |   |        |     
|Net income, as reported      |                                                                                                                                            | $                | 79,271 |      |                    | $ | 118,006 |      |      | $ | 43,114 |      |      | $ | 59,051 |     
|                             | Add: Stock-based employee compensation expense included in
    reported net income, net of related tax effects                             |                  |        | 174  |                    |   |         | 167  |      |   |        | 95   |      |   |        | 92   |     
|                             | Deduct: Total stock-based compensation expense determined under
    fair value based method for all awards, net of related tax
    effects |                  |        | (345 | )                  |   |         | (341 | )    |   |        | (173 | )    |   |        | (171 | )   
|                             |                                                                                                                                            |                  |        |      |                    |   |         |      |      |   |        |     
|Pro forma net income         |                                                                                                                                            | $                | 79,100 |      |                    | $ | 117,832 |      |      | $ | 43,036 |      |      | $ | 58,972 |     
|                             |                                                                                                                                            |                  |        |      |                    |   |         |      |      |   |        |     
|Net income per common share: |                                                                                                                                            |                  |        |      |                    |   |         |      |      |   |        |      |      |   |        |     
|                             | As reported:                                                                                                                               |                  |        |      |                    |   |         |      |      |   |        |      |      |   |        |      |     
|                             |                                                                                                                                            | Basic            |        | $    | 1.23               |   |         | $    | 1.83 |   |        | $    | 0.67 |   |        | $    | 0.92 | 
|                             |                                                                                                                                            | Diluted          |        |      | 1.16               |   |         |      | 1.70 |   |        |      | 0.63 |   |        |      | 0.85 | 
|                             | Pro forma:                                                                                                                                 |                  |        |      |                    |   |         |      |      |   |        |      |      |   |        |      |     
|                             |                                                                                                                                            | Basic            |        | $    | 1.23               |   |         | $    | 1.83 |   |        | $    | 0.67 |   |        | $    | 0.92 | 
|                             |                                                                                                                                            | Diluted          |        |      | 1.15               |   |         |      | 1.70 |   |        |      | 0.63 |   |        |      | 0.85 | 

10



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                           
|-- | ------------------------------------------
|5. | Unpaid Losses and Loss Adjustment Expenses



|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |         |  |   |           |         | 
|------------------------------------------------------------------------------ | ------------ | ---------------- | --------- | ------- | ------------------ | - | --------- | ------- |  | - | --------- | ------- |  | - | --------- | ------- | 
|                                                                               |              | Six Months Ended |           |         | Three Months Ended |  
|                                                                               |              | June 30,         |           |         | June 30,           |  
|                                                                               |              |                  |           |         |                    |  
|                                                                               |              | 2005             |           |         | 2004               |   |           | 2005    |  |   | 2004      |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Gross unpaid losses and loss adjustment expenses, beginning of
    period      |              | $                | 4,228,021 |         |                    | $ | 3,400,277 |         |  | $ | 4,333,325 |         |  | $ | 3,535,411 |        
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of period |              |                  | 1,092,082 |         |                    |   | 1,058,623 |         |  |   | 1,061,159 |         |  |   | 1,070,448 |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Net unpaid losses and loss adjustment expenses, beginning of
    period        |              |                  | 3,135,939 |         |                    |   | 2,341,654 |         |  |   | 3,272,166 |         |  |   | 2,464,963 |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Losses and loss adjustment expenses incurred related to:                       |              |                  |           |         |                    |   |           |         |  |   |           |         |  |   |           |        
|                                                                               | Current year |                  |           | 735,219 |                    |   |           | 679,034 |  |   |           | 368,345 |  |   |           | 341,878 | 
|                                                                               | Prior years  |                  |           | 71,080  |                    |   |           | 68,284  |  |   |           | 23,875  |  |   |           | 41,883  | 
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Total losses and loss adjustment expenses incurred                             |              |                  | 806,299   |         |                    |   | 747,318   |         |  |   | 392,220   |         |  |   | 383,761   |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Paid losses and loss adjustment expenses related to:                           |              |                  |           |         |                    |   |           |         |  |   |           |         |  |   |           |        
|                                                                               | Current year |                  |           | 115,598 |                    |   |           | 87,018  |  |   |           | 57,057  |  |   |           | 60,079  | 
|                                                                               | Prior years  |                  |           | 481,133 |                    |   |           | 395,691 |  |   |           | 262,631 |  |   |           | 175,861 | 
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Total paid losses and loss adjustment expenses                                 |              |                  | 596,731   |         |                    |   | 482,709   |         |  |   | 319,688   |         |  |   | 235,940   |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Effects of exchange rate changes                                               |              |                  | (18,518   | )       |                    |   | 8,670     |         |  |   | (17,709   | )       |  |   | 2,149     |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Net unpaid losses and loss adjustment expenses, end of period                  |              |                  | 3,326,989 |         |                    |   | 2,614,933 |         |  |   | 3,326,989 |         |  |   | 2,614,933 |        
|Add ceded unpaid losses and loss adjustment expenses, end of
    period        |              |                  | 1,061,073 |         |                    |   | 1,069,798 |         |  |   | 1,061,073 |         |  |   | 1,069,798 |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        
|Gross unpaid losses and loss adjustment expenses, end of period                |              | $                | 4,388,062 |         |                    | $ | 3,684,731 |         |  | $ | 4,388,062 |         |  | $ | 3,684,731 |        
|                                                                               |              |                  |           |         |                    |   |           |         |  |   |           |        





11



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)








|   |                                                                   
|-- | ------------------------------------------------------------------
|6. | Asbestos and Environmental Losses and Loss Adjustment
    Expenses







12



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         |  |  |   |         | 
|------------------------------------------------------------------------------ |  | ---------------- | ------- |  | ------------------ | - | ------- | ---- |  | - | ------- |  |  | - | ------- | 
|                                                                               |  | Six Months Ended |         |  | Three Months Ended |  
|                                                                               |  | June 30,         |         |  | June 30,           |  
|                                                                               |  |                  |         |  |                    |  
|                                                                               |  | 2005             |         |  | 2004               |   |         | 2005 |  |   | 2004    | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|ASBESTOS                                                                       |  |                  |         |  |                    |   |         |      |  |   |         |  |  |   |         | 
|Gross unpaid losses and loss adjustment expenses, beginning of
    period      |  | $                | 242,151 |  |                    | $ | 215,662 |      |  | $ | 234,528 |  |  | $ | 225,296 | 
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of period |  |                  | 191,422 |  |                    |   | 186,178 |      |  |   | 183,799 |  |  |   | 195,812 | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Net unpaid losses and loss adjustment expenses, beginning of
    period        |  |                  | 50,729  |  |                    |   | 29,484  |      |  |   | 50,729  |  |  |   | 29,484  | 
|Net losses and loss adjustment expenses incurred                               |  |                  |        |  |                    |   |        |      |  |   |        |  |  |   |        | 
|Net paid losses and loss adjustment expenses                                   |  |                  |        |  |                    |   |        |      |  |   |        |  |  |   |        | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Net unpaid losses and loss adjustment expenses, end of period                  |  |                  | 50,729  |  |                    |   | 29,484  |      |  |   | 50,729  |  |  |   | 29,484  | 
|Add ceded unpaid losses and loss adjustment expenses, end of
    period        |  |                  | 182,027 |  |                    |   | 199,814 |      |  |   | 182,027 |  |  |   | 199,814 | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Gross unpaid losses and loss adjustment expenses, end of period                |  | $                | 232,756 |  |                    | $ | 229,298 |      |  | $ | 232,756 |  |  | $ | 229,298 | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|                                                                              
|ENVIRONMENTAL                                                                  |  |                  |         |  |                    |   |         |      |  |   |         |  |  |   |         | 
|Gross unpaid losses and loss adjustment expenses, beginning of
    period      |  | $                | 29,898  |  |                    | $ | 33,272  |      |  | $ | 33,079  |  |  | $ | 34,330  | 
|Less ceded unpaid losses and loss adjustment expenses, beginning
    of period |  |                  | 19,006  |  |                    |   | 1,135   |      |  |   | 22,187  |  |  |   | 2,193   | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Net unpaid losses and loss adjustment expenses, beginning of
    period        |  |                  | 10,892  |  |                    |   | 32,137  |      |  |   | 10,892  |  |  |   | 32,137  | 
|Net losses and loss adjustment expenses incurred                               |  |                  |        |  |                    |   |        |      |  |   |        |  |  |   |        | 
|Net paid losses and loss adjustment expenses                                   |  |                  |        |  |                    |   |        |      |  |   |        |  |  |   |        | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Net unpaid losses and loss adjustment expenses, end of period                  |  |                  | 10,892  |  |                    |   | 32,137  |      |  |   | 10,892  |  |  |   | 32,137  | 
|Add ceded unpaid losses and loss adjustment expenses, end of
    period        |  |                  | 23,480  |  |                    |   | 257     |      |  |   | 23,480  |  |  |   | 257     | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 
|Gross unpaid losses and loss adjustment expenses, end of period                |  | $                | 34,372  |  |                    | $ | 32,394  |      |  | $ | 34,372  |  |  | $ | 32,394  | 
|                                                                               |  |                  |         |  |                    |   |         |      |  |   |         | 



13



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                  
|-- | -----------------
|7. | Segment Reporting





|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   |           |         |  
|------------------------------------------------- | ------------------------------------------------- | -------- | ------- | ------- | -------- | ------ | ------- | ------ | ---- | - | --------- | ------ | - | ----- | ------- | ------ | - | - | --------- | ------- | -
|                                                  |                                                   |          |         |         |          | London |         |        | U.S. |   |           |       
|Six months ended June 30, 2005                    |                                                   | Americas |         |         | EuroAsia |        |         | Market |      |   | Insurance |        |   | Total |        
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Gross premiums written                            |                                                   | $        | 557,254 |         |          | $      | 282,791 |        |      | $ | 194,811   |        |   | $     | 248,612 |        |   | $ | 1,283,468 |        
|Net premiums written                              |                                                   |          | 536,238 |         |          |        | 270,393 |        |      |   | 174,312   |        |   |       | 172,355 |        |   |   | 1,153,298 |        
|Net premiums earned                               |                                                   | $        | 548,500 |         |          | $      | 271,201 |        |      | $ | 177,551   |        |   | $     | 144,758 |        |   | $ | 1,142,010 |        
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 421,133 |         |          |        | 181,892 |        |      |   | 111,275   |        |   |       | 91,999  |        |   |   | 806,299   |        
|Acquisition costs and other underwriting expenses |                                                   |          | 163,251 |         |          |        | 72,034  |        |      |   | 43,995    |        |   |       | 29,681  |        |   |   | 308,961   |        
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Total underwriting deductions                     |                                                   |          | 584,384 |         |          |        | 253,926 |        |      |   | 155,270   |        |   |       | 121,680 |        |   |   | 1,115,260 |        
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Underwriting (loss) income                        |          | $       | (35,884 | )        |        | $       | 17,275 |      |   | $         | 22,281 |   |       | $       | 23,078 |   |   |           | 26,750  |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Net investment income                             |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | 115,162   |        
|Net realized investment gains                     |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | 7,943     |        
|Other expense, net                                |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (14,265   | )      
|Interest expense                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (13,917   | )      
|Loss on early extinguishment of debt              |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (2,060    | )      
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Income before income taxes                        |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | $         | 119,613 |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Underwriting ratios:                              |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   |           |        
|                                                  | Losses and loss adjustment expenses               |          |         | 76.8    | %        |        |         | 67.1   | %    |   |           | 62.7   | % |       |         | 63.6   | % |   |           | 70.6    | %
|                                                  | Acquisition costs and other underwriting expenses |          |         | 29.7    |          |        |         | 26.5   |      |   |           | 24.8   |   |       |         | 20.5   |   |   |           | 27.1    |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Combined ratio                                    |          |         | 106.5   | %        |        |         | 93.6   | %    |   |           | 87.5   | % |       |         | 84.1   | % |   |           | 97.7    | %
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        

14



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   |           |         |  
|------------------------------------------------- | ------------------------------------------------- | -------- | ------- | ----- | -------- | ------ | ------- | ------ | ---- | - | --------- | ------ | - | ----- | ------- | ----- | - | - | --------- | ------- | -
|                                                  |                                                   |          |         |       |          | London |         |        | U.S. |   |           |       
|Six months ended June 30, 2004                    |                                                   | Americas |         |       | EuroAsia |        |         | Market |      |   | Insurance |        |   | Total |        
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|Gross premiums written                            |                                                   | $        | 618,879 |       |          | $      | 268,416 |        |      | $ | 187,601   |        |   | $     | 166,563 |       |   | $ | 1,241,459 |        
|Net premiums written                              |                                                   |          | 592,230 |       |          |        | 255,702 |        |      |   | 161,380   |        |   |       | 93,938  |       |   |   | 1,103,250 |        
|Net premiums earned                               |                                                   | $        | 607,677 |       |          | $      | 231,822 |        |      | $ | 203,178   |        |   | $     | 83,698  |       |   | $ | 1,126,375 |        
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 405,720 |       |          |        | 148,291 |        |      |   | 134,189   |        |   |       | 59,118  |       |   |   | 747,318   |        
|Acquisition costs and other underwriting expenses |                                                   |          | 193,392 |       |          |        | 60,896  |        |      |   | 51,415    |        |   |       | 15,666  |       |   |   | 321,369   |        
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|Total underwriting deductions                     |                                                   |          | 599,112 |       |          |        | 209,187 |        |      |   | 185,604   |        |   |       | 74,784  |       |   |   | 1,068,687 |        
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Underwriting income                               |          | $       | 8,565 |          |        | $       | 22,635 |      |   | $         | 17,574 |   |       | $       | 8,914 |   |   |           | 57,688  |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|Net investment income                             |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   | 70,567    |        
|Net realized investment gains                     |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   | 67,256    |        
|Other expense, net                                |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   | (4,956    | )      
|Interest expense                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   | (12,799   | )      
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Income before income taxes                        |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   | $         | 177,756 |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|Underwriting ratios:                              |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |         |       |   |   |           |        
|                                                  | Losses and loss adjustment expenses               |          |         | 66.8  | %        |        |         | 64.0   | %    |   |           | 66.1   | % |       |         | 70.6  | % |   |           | 66.4    | %
|                                                  | Acquisition costs and other underwriting expenses |          |         | 31.8  |          |        |         | 26.2   |      |   |           | 25.3   |   |       |         | 18.7  |   |   |           | 28.5    |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Combined ratio                                    |          |         | 98.6  | %        |        |         | 90.2   | %    |   |           | 91.4   | % |       |         | 89.3  | % |   |           | 94.9    | %
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        

15



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   |         |        |  
|------------------------------------------------- | ------------------------------------------------- | -------- | ------- | ------- | -------- | ------ | ------- | ------ | ---- | - | --------- | ------ | - | ----- | ------- | ------ | - | - | ------- | ------ | -
|                                                  |                                                   |          |         |         |          | London |         |        | U.S. |   |           |       
|Three months ended June 30, 2005                  |                                                   | Americas |         |         | EuroAsia |        |         | Market |      |   | Insurance |        |   | Total |        
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Gross premiums written                            |                                                   | $        | 250,497 |         |          | $      | 143,562 |        |      | $ | 97,468    |        |   | $     | 110,374 |        |   | $ | 601,901 |       
|Net premiums written                              |                                                   |          | 235,943 |         |          |        | 142,473 |        |      |   | 85,102    |        |   |       | 74,205  |        |   |   | 537,723 |       
|Net premiums earned                               |                                                   | $        | 271,533 |         |          | $      | 139,019 |        |      | $ | 86,876    |        |   | $     | 76,314  |        |   | $ | 573,742 |       
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Losses and loss adjustment expenses               |                                                   |          | 213,182 |         |          |        | 80,038  |        |      |   | 49,427    |        |   |       | 49,573  |        |   |   | 392,220 |       
|Acquisition costs and other underwriting expenses |                                                   |          | 82,937  |         |          |        | 37,431  |        |      |   | 22,377    |        |   |       | 15,290  |        |   |   | 158,035 |       
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Total underwriting deductions                     |                                                   |          | 296,119 |         |          |        | 117,469 |        |      |   | 71,804    |        |   |       | 64,863  |        |   |   | 550,255 |       
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Underwriting (loss) income                        |          | $       | (24,586 | )        |        | $       | 21,550 |      |   | $         | 15,072 |   |       | $       | 11,451 |   |   |         | 23,487 |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Net investment income                             |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | 50,047  |       
|Net realized investment gains                     |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | 7,792   |       
|Other expense, net                                |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (6,038  | )     
|Interest expense                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (7,511  | )     
|Loss on early extinguishment of debt              |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | (2,060  | )     
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Income before income taxes                        |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   | $       | 65,717 |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|Underwriting ratios:                              |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |         |        |   |   |         |       
|                                                  | Losses and loss adjustment expenses               |          |         | 78.5    | %        |        |         | 57.6   | %    |   |           | 56.9   | % |       |         | 65.0   | % |   |         | 68.4   | %
|                                                  | Acquisition costs and other underwriting expenses |          |         | 30.6    |          |        |         | 26.9   |      |   |           | 25.8   |   |       |         | 20.0   |   |   |         | 27.5   |  
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        
|                                                  | Combined ratio                                    |          |         | 109.1   | %        |        |         | 84.5   | %    |   |           | 82.7   | % |       |         | 85.0   | % |   |         | 95.9   | %
|                                                  |                                                   |          |         |         |          |        |         |        |      |   |           |        |   |       |        

16



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   |         |        |  
|------------------------------------------------- | ------------------------------------------------- | -------- | ------- | ----- | -------- | ------ | ------- | ------ | ---- | - | --------- | ------ | - | ----- | ------ | ----- | - | - | ------- | ------ | -
|                                                  |                                                   |          |         |       |          | London |         |        | U.S. |   |           |       
|Three months ended June 30, 2004                  |                                                   | Americas |         |       | EuroAsia |        |         | Market |      |   | Insurance |        |   | Total |       
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|Gross premiums written                            |                                                   | $        | 289,879 |       |          | $      | 142,603 |        |      | $ | 102,896   |        |   | $     | 76,598 |       |   | $ | 611,976 |       
|Net premiums written                              |                                                   |          | 278,033 |       |          |        | 133,953 |        |      |   | 91,863    |        |   |       | 46,162 |       |   |   | 550,011 |       
|Net premiums earned                               |                                                   | $        | 310,453 |       |          | $      | 116,197 |        |      | $ | 106,515   |        |   | $     | 46,949 |       |   | $ | 580,114 |       
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|Losses and loss adjustment expenses               |                                                   |          | 213,029 |       |          |        | 72,196  |        |      |   | 66,618    |        |   |       | 31,918 |       |   |   | 383,761 |       
|Acquisition costs and other underwriting expenses |                                                   |          | 95,763  |       |          |        | 32,193  |        |      |   | 26,652    |        |   |       | 11,371 |       |   |   | 165,979 |       
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|Total underwriting deductions                     |                                                   |          | 308,792 |       |          |        | 104,389 |        |      |   | 93,270    |        |   |       | 43,289 |       |   |   | 549,740 |       
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|                                                  | Underwriting income                               |          | $       | 1,661 |          |        | $       | 11,808 |      |   | $         | 13,245 |   |       | $      | 3,660 |   |   |         | 30,374 |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|Net investment income                             |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   | 35,105  |       
|Net realized investment gains                     |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   | 32,417  |       
|Other expense, net                                |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   | (2,596  | )     
|Interest expense                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   | (6,405  | )     
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|                                                  | Income before income taxes                        |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   | $       | 88,895 |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|Underwriting ratios:                              |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |        |       |   |   |         |       
|                                                  | Losses and loss adjustment expenses               |          |         | 68.6  | %        |        |         | 62.1   | %    |   |           | 62.5   | % |       |        | 68.0  | % |   |         | 66.2   | %
|                                                  | Acquisition costs and other underwriting expenses |          |         | 30.9  |          |        |         | 27.7   |      |   |           | 25.0   |   |       |        | 24.2  |   |   |         | 28.6   |  
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       
|                                                  | Combined ratio                                    |          |         | 99.5  | %        |        |         | 89.8   | %    |   |           | 87.5   | % |       |        | 92.2  | % |   |         | 94.8   | %
|                                                  |                                                   |          |         |       |          |        |         |        |      |   |           |        |   |       |       





|   |                 
|-- | ----------------
|8. | Debt Obligations



|                                     |  |          |         |  |              |   |         | 
|------------------------------------ |  | -------- | ------- |  | ------------ | - | ------- | 
|                                     |  | As of    |         |  | As of        |  
|                                     |  | June 30, |         |  | December 31, |  
|                                     |  | 2005     |         |  | 2004         |  
|                                     |  |          |         |  |              |  
|7.65% Senior Notes                   |  | $        | 224,637 |  |              | $ | 224,616 | 
|4.375% Convertible Senior Debentures |  |          | 91,602  |  |              |   | 109,900 | 
|7.49% Senior Notes                   |  |          | 41,127  |  |              |   | 41,524  | 
|6.875% Senior Notes                  |  |          | 124,207 |  |              |   |        | 
|                                     |  |          |         |  |              |  
|Total debt obligations               |  | $        | 481,573 |  |              | $ | 376,040 | 
|                                     |  |          |         |  |              |  



17



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










|      |  |        |         | 
|----- |  | ------ | ------- | 
|Year  |  | Amount |        
|      |  |        |        
|2006  |  | $      | 40,000  | 
|2013  |  |        | 225,000 | 
|2015  |  |        | 125,000 | 
|2022  |  |        | 91,602  | 
|      |  |        |        
|Total |  | $      | 481,602 | 
|      |  |        |        



18



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                  
|-- | -----------------
|9. | Employee Benefits





|                              |                   |                  |        |       |                    |   |       |       |  |   |      |     |  |   |      |     |  
|----------------------------- | ----------------- | ---------------- | ------ | ----- | ------------------ | - | ----- | ----- |  | - | ---- | --- |  | - | ---- | --- | -
|                              |                   | Six Months Ended |        |       | Three Months Ended |  
|                              |                   | June 30,         |        |       | June 30,           |  
|                              |                   |                  |        |       |                    |  
|                              |                   | 2005             |        |       | 2004               |   |       | 2005  |  |   | 2004 |    
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|Qualified Plan:               |                   |                  |        |       |                    |   |       |       |  |   |      |     |  |   |      |    
|Service cost                  |                   | $                | 1,671  |       |                    | $ | 1,105 |       |  | $ | 835  |     |  | $ | 552  |    
|Interest cost                 |                   |                  | 1,180  |       |                    |   | 1,053 |       |  |   | 590  |     |  |   | 527  |    
|Return on assets              |                   |                  | (1,144 | )     |                    |   | (822  | )     |  |   | (572 | )   |  |   | (411 | )  
|Recognized net actuarial loss |                   |                  | 23     |       |                    |   |      |       |  |   | 11   |     |  |   |     |    
|Net amortization and deferral |                   |                  | 27     |       |                    |   | 5     |       |  |   | 13   |     |  |   | 3    |    
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|                              | Net periodic cost |                  | $      | 1,757 |                    |   | $     | 1,341 |  |   | $    | 877 |  |   | $    | 671 |  
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|Excess Plans:                 |                   |                  |        |       |                    |   |       |       |  |   |      |     |  |   |      |    
|Service cost                  |                   | $                | 345    |       |                    | $ | 272   |       |  | $ | 173  |     |  | $ | 136  |    
|Interest cost                 |                   |                  | 400    |       |                    |   | 349   |       |  |   | 200  |     |  |   | 175  |    
|Recognized net actuarial loss |                   |                  | 165    |       |                    |   | 90    |       |  |   | 82   |     |  |   | 46   |    
|Recognized prior service cost |                   |                  | (19    | )     |                    |   | (19   | )     |  |   | (10  | )   |  |   | (10  | )  
|Other                         |                   |                  | 34     |       |                    |   | 34    |       |  |   | 17   |     |  |   | 17   |    
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|                              | Net periodic cost |                  | $      | 925   |                    |   | $     | 726   |  |   | $    | 462 |  |   | $    | 364 |  
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|Postretirement Plan:          |                   |                  |        |       |                    |   |       |       |  |   |      |     |  |   |      |    
|Service cost                  |                   | $                | 564    |       |                    | $ | 531   |       |  | $ | 282  |     |  | $ | 231  |    
|Interest cost                 |                   |                  | 242    |       |                    |   | 224   |       |  |   | 121  |     |  |   | 87   |    
|Curtailment credit            |                   |                  |       |       |                    |   | (291  | )     |  |   |     |     |  |   | (291 | )  
|Other                         |                   |                  | (52    | )     |                    |   | (32   | )     |  |   | (26  | )   |  |   | (45  | )  
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    
|                              | Net periodic cost |                  | $      | 754   |                    |   | $     | 432   |  |   | $    | 377 |  |   | $    | (18 | )
|                              |                   |                  |        |       |                    |   |       |       |  |   |      |    



19



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|    |              
|--- | -------------
|10. | Contingencies











20



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










21



---



##### 



ODYSSEY RE HOLDINGS CORP.


NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|    |                 
|--- | ----------------
|11. | Subsequent Event



22



---



##### 








|                 |                                                                                          
|---------------- | -----------------------------------------------------------------------------------------
|PART 1  Item 2. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

Overview


















23



---



##### 











|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         |  |  |   |       |   |  |   |       |  
|------------- |  | ------------------------ | ----- |  | --------- | - | ----- | ----------- |  | ------ | ------- | - | ----- | -------- | ----- | ----- | --------- | - | ----- | ----------- | ------ | - | ------- |  |  | - | ----- | - |  | - | ----- | -
|              |  | 2005                     |       |  | 2004      |  
|              |  |                          |       |  |           |  
|              |  | As of                    |       |  | As of     |   |       |             |  | Change |         |   | As of |          |       | As of |           |   |       |             | Change |  
|              |  | June 30,                 |       |  | March 31, |   |       | Change Year |  |        | Second  |   |       | June 30, |       |       | March 31, |   |       | Change Year |        |   | Second  | 
|Division      |  | 2005                     |       |  | 2005      |   |       | to Date     |  |        | Quarter |   |       | 2004     |       |       | 2004      |   |       | to Date     |        |   | Quarter | 
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|             
|              |  | Gross Premiums Written  
|Americas      |  | $                        | 249.9 |  |           | $ | 280.2 |             |  | $      | (19.1   | ) |       | $        | (30.3 | )     |           | $ | 278.2 |             |        | $ | 259.4   |  |  | $ | 7.5   |   |  | $ | 18.8  |  
|EuroAsia      |  |                          | 134.4 |  |           |   | 121.9 |             |  |        | 18.8    |   |       |          | 12.5  |       |           |   | 107.9 |             |        |   | 84.7    |  |  |   | 31.9  |   |  |   | 23.2  |  
|London Market |  |                          | 45.0  |  |           |   | 57.5  |             |  |        | (16.2   | ) |       |          | (12.5 | )     |           |   | 36.7  |             |        |   | 47.8    |  |  |   | (18.9 | ) |  |   | (11.1 | )
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|Total         |  | $                        | 429.3 |  |           | $ | 459.6 |             |  | $      | (16.5   | ) |       | $        | (30.3 | )     |           | $ | 422.8 |             |        | $ | 391.9   |  |  | $ | 20.5  |   |  | $ | 30.9  |  
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|             
|              |  | Acquisition Costs       
|Americas      |  | $                        | 59.4  |  |           | $ | 65.6  |             |  | $      | (29.2   | ) |       | $        | (6.2  | )     |           | $ | 75.3  |             |        | $ | 69.7    |  |  | $ | (21.0 | ) |  | $ | 5.6   |  
|EuroAsia      |  |                          | 41.7  |  |           |   | 41.2  |             |  |        | 8.6     |   |       |          | 0.5   |       |           |   | 34.4  |             |        |   | 29.9    |  |  |   | 10.6  |   |  |   | 4.5   |  
|London Market |  |                          | 5.9   |  |           |   | 11.1  |             |  |        | (4.8    | ) |       |          | (5.2  | )     |           |   | 6.3   |             |        |   | 8.4     |  |  |   | (6.6  | ) |  |   | (2.1  | )
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|Total         |  | $                        | 107.0 |  |           | $ | 117.9 |             |  | $      | (25.4   | ) |       | $        | (10.9 | )     |           | $ | 116.0 |             |        | $ | 108.0   |  |  | $ | (17.0 | ) |  | $ | 8.0   |  
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|             
|              |  | Premiums Receivable     
|Americas      |  | $                        | 190.5 |  |           | $ | 213.8 |             |  | $      | 3.7     |   |       | $        | (23.3 | )     |           | $ | 202.9 |             |        | $ | 183.4   |  |  | $ | 8.5   |   |  | $ | 19.5  |  
|EuroAsia      |  |                          | 92.7  |  |           |   | 80.7  |             |  |        | 13.1    |   |       |          | 12.0  |       |           |   | 73.5  |             |        |   | 55.9    |  |  |   | 21.1  |   |  |   | 17.6  |  
|London Market |  |                          | 40.1  |  |           |   | 52.8  |             |  |        | 3.3     |   |       |          | (12.7 | )     |           |   | 30.4  |             |        |   | 44.0    |  |  |   | (15.2 | ) |  |   | (13.6 | )
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|Total         |  | $                        | 323.3 |  |           | $ | 347.3 |             |  | $      | 20.1    |   |       | $        | (24.0 | )     |           | $ | 306.8 |             |        | $ | 283.3   |  |  | $ | 14.4  |   |  | $ | 23.5  |  
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|             
|              |  | Unearned Premium Reserve
|Americas      |  | $                        | 172.2 |  |           | $ | 190.6 |             |  | $      | 9.5     |   |       | $        | (18.4 | )     |           | $ | 161.5 |             |        | $ | 173.1   |  |  | $ | (6.1  | ) |  | $ | (11.6 | )
|EuroAsia      |  |                          | 92.1  |  |           |   | 79.9  |             |  |        | (5.2    | ) |       |          | 12.2  |       |           |   | 74.5  |             |        |   | 51.2    |  |  |   | 18.8  |   |  |   | 23.3  |  
|London Market |  |                          | 21.7  |  |           |   | 13.5  |             |  |        | 8.1     |   |       |          | 8.2   |       |           |   | 8.8   |             |        |   | 8.2     |  |  |   | (10.1 | ) |  |   | 0.6   |  
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 
|Total         |  | $                        | 286.0 |  |           | $ | 284.0 |             |  | $      | 12.4    |   |       | $        | 2.0   |       |           | $ | 244.8 |             |        | $ | 232.5   |  |  | $ | 2.6   |   |  | $ | 12.3  |  
|              |  |                          |       |  |           |   |       |             |  |        |         |   |       |          |       |       |           |   |       |             |        |   |         | 

24



---



##### 











|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |       |  |  |   |         | 
|----------------------------------------------------------------------- |  | -------- | ------- |  | -------- | ------ | ----- | ------ | ---- | - | --------- |  |  | ----- | ----- |  |  | - | ------- | 
|                                                                        |  |          |         |  |          | London |       |        | U.S. |   |           | 
|                                                                        |  | Americas |         |  | EuroAsia |        |       | Market |      |   | Insurance |  |  | Total |      
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Gross case reserves                                                     |  | $        | 1,695.5 |  |          | $      | 246.6 |        |      | $ | 260.8     |  |  | $     | 114.4 |  |  | $ | 2,317.3 | 
|Gross IBNR                                                              |  |          | 1,012.8 |  |          |        | 205.8 |        |      |   | 536.0     |  |  |       | 316.2 |  |  |   | 2,070.8 | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Total gross reserves for unpaid
    losses and loss adjustment expenses |  |          | 2,708.3 |  |          |        | 452.4 |        |      |   | 796.8     |  |  |       | 430.6 |  |  |   | 4,388.1 | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Ceded case reserves                                                     |  |          | 548.4   |  |          |        | 8.8   |        |      |   | 62.3      |  |  |       | 50.7  |  |  |   | 670.2   | 
|Ceded IBNR                                                              |  |          | 152.9   |  |          |        | 11.3  |        |      |   | 109.7     |  |  |       | 117.0 |  |  |   | 390.9   | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Total ceded reserves for unpaid
    losses and loss adjustment expenses |  |          | 701.3   |  |          |        | 20.1  |        |      |   | 172.0     |  |  |       | 167.7 |  |  |   | 1,061.1 | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Net case reserves                                                       |  |          | 1,147.1 |  |          |        | 237.8 |        |      |   | 198.5     |  |  |       | 63.7  |  |  |   | 1,647.1 | 
|Net IBNR                                                                |  |          | 859.9   |  |          |        | 194.5 |        |      |   | 426.3     |  |  |       | 199.2 |  |  |   | 1,679.9 | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      
|Total net reserves for unpaid
    losses and loss adjustment expenses   |  | $        | 2,007.0 |  |          | $      | 432.3 |        |      | $ | 624.8     |  |  | $     | 262.9 |  |  | $ | 3,327.0 | 
|                                                                        |  |          |         |  |          |        |       |        |      |   |           |  |  |       |      



25



---



##### 









Results of Operations




| |                                                                                  
| | ---------------------------------------------------------------------------------
| | Three Months Ended June 30, 2005 Compared to Three
    Months Ended June 30, 2004

Gross Premiums Written.


|                             |  |                    |         |  |      |   |         |        |  |   |         |   |  |  |       |   
|---------------------------- |  | ------------------ | ------- |  | ---- | - | ------- | ------ |  | - | ------- | - |  |  | ----- | --
|                             |  | Three Months Ended |         |  |      |   |        
|                             |  | June 30,           |         |  |      |   |        
|                             |  |                    |         |  | $    |   |         | %      | 
|Division                     |  | 2005               |         |  | 2004 |   |         | Change |  |   | Change  |  
|                             |  |                    |         |  |      |   |         |        |  |   |         |  
|Americas                     |  | $                  | 250,497 |  |      | $ | 289,879 |        |  | $ | (39,382 | ) |  |  | (13.6 | )%
|EuroAsia                     |  |                    | 143,562 |  |      |   | 142,603 |        |  |   | 959     |   |  |  | 0.7   |   
|London Market                |  |                    | 97,468  |  |      |   | 102,896 |        |  |   | (5,428  | ) |  |  | (5.3  | ) 
|U.S. Insurance               |  |                    | 110,374 |  |      |   | 76,598  |        |  |   | 33,776  |   |  |  | 44.1  |   
|                             |  |                    |         |  |      |   |         |        |  |   |         |  
|Total gross premiums written |  | $                  | 601,901 |  |      | $ | 611,976 |        |  | $ | (10,075 | ) |  |  | (1.6  | )%
|                             |  |                    |         |  |      |   |         |        |  |   |         |  





26



---



##### 









Ceded Premiums Written.


Net Premiums Written.


Net Premiums Earned.


27



---



##### 





Net Investment Income.


Net Realized Investment Gains.




Losses and Loss Adjustment Expenses.


28



---



##### 





|                                             |  |                |      |   |            |  |      |        |  |  |      |  
|-------------------------------------------- |  | -------------- | ---- | - | ---------- |  | ---- | ------ |  |  | ---- | -
|                                             |  | Three Months   |      |   |           
|                                             |  | Ended June 30, |      |   | Percentage | 
|                                             |  |                |      |   | Point      | 
|Division                                     |  | 2005           |      |   | 2004       |  |      | Change | 
|                                             |  |                |      |   |            |  |      |        | 
|Americas                                     |  |                | 78.5 | % |            |  | 68.6 | %      |  |  | 9.9  |  
|EuroAsia                                     |  |                | 57.6 |   |            |  | 62.1 |        |  |  | (4.5 | )
|London Market                                |  |                | 56.9 |   |            |  | 62.5 |        |  |  | (5.6 | )
|U.S. Insurance                               |  |                | 65.0 |   |            |  | 68.0 |        |  |  | (3.0 | )
|                                             |  |                |      |   |            |  |      |        | 
|Total loss and loss adjustment expense ratio |  |                | 68.4 | % |            |  | 66.2 | %      |  |  | 2.2  |  









Acquisition Costs.


29



---



##### 





Other Underwriting Expenses.


Other Expenses, Net.


Interest Expense.


Federal and Foreign Income Tax Provision.




| |                                                                              
| | -----------------------------------------------------------------------------
| | Six Months Ended June 30, 2005 Compared to Six Months
    Ended June 30, 2004

Gross Premiums Written.


|                             |  |                  |           |  |      |   |           |        |  |   |         |   |  |  |       |   
|---------------------------- |  | ---------------- | --------- |  | ---- | - | --------- | ------ |  | - | ------- | - |  |  | ----- | --
|                             |  | Six Months Ended |           |  |      |   |          
|                             |  | June 30,         |           |  |      |   |          
|                             |  |                  |           |  | $    |   |           | %      | 
|Division                     |  | 2005             |           |  | 2004 |   |           | Change |  |   | Change  |  
|                             |  |                  |           |  |      |   |           |        |  |   |         |  
|Americas                     |  | $                | 557,254   |  |      | $ | 618,879   |        |  | $ | (61,625 | ) |  |  | (10.0 | )%
|EuroAsia                     |  |                  | 282,791   |  |      |   | 268,416   |        |  |   | 14,375  |   |  |  | 5.4   |   
|London Market                |  |                  | 194,811   |  |      |   | 187,601   |        |  |   | 7,210   |   |  |  | 3.8   |   
|U.S. Insurance               |  |                  | 248,612   |  |      |   | 166,563   |        |  |   | 82,049  |   |  |  | 49.3  |   
|                             |  |                  |           |  |      |   |           |        |  |   |         |  
|Total gross premiums written |  | $                | 1,283,468 |  |      | $ | 1,241,459 |        |  | $ | 42,009  |   |  |  | 3.4   | % 
|                             |  |                  |           |  |      |   |           |        |  |   |         |  





30



---



##### 











Ceded Premiums Written.


31



---



##### 





Net Premiums Written.


Net Premiums Earned.


Net Investment Income.


Net Realized Investment Gains.


Losses and Loss Adjustment Expenses.


32



---



##### 





|                                             |  |                  |      |   |            |  |      |        |  |  |      |  
|-------------------------------------------- |  | ---------------- | ---- | - | ---------- |  | ---- | ------ |  |  | ---- | -
|                                             |  | Six Months Ended |      |   |           
|                                             |  | June 30,         |      |   | Percentage | 
|                                             |  |                  |      |   | Point      | 
|Division                                     |  | 2005             |      |   | 2004       |  |      | Change | 
|                                             |  |                  |      |   |            |  |      |        | 
|Americas                                     |  |                  | 76.8 | % |            |  | 66.8 | %      |  |  | 10.0 |  
|EuroAsia                                     |  |                  | 67.1 |   |            |  | 64.0 |        |  |  | 3.1  |  
|London Market                                |  |                  | 62.7 |   |            |  | 66.1 |        |  |  | (3.4 | )
|U.S. Insurance                               |  |                  | 63.6 |   |            |  | 70.6 |        |  |  | (7.0 | )
|                                             |  |                  |      |   |            |  |      |        | 
|Total loss and loss adjustment expense ratio |  |                  | 70.6 | % |            |  | 66.4 | %      |  |  | 4.2  |  







33



---



##### 







Acquisition Costs.


Other Underwriting Expenses.


Other Expenses, Net.


Interest Expense.


Federal and Foreign Income Tax Provision.


Liquidity and Capital Resources




34



---



##### 

















35



---



##### 









Financial Strength and Credit Ratings








Accounting Pronouncements






36



---



##### 







Off-Balance Sheet Arrangements







PART I  Item 3. Quantitative and
Qualitative Disclosures About Market Risk


Market Sensitive Instruments




Interest Rate Risk




|                                 |  |                     |         |  |                         |                       |            |              |  |  |           |    |  |              |         |  |              |   |        |   |  |  |       |   
|-------------------------------- |  | ------------------- | ------- |  | ----------------------- | --------------------- | ---------- | ------------ |  |  | --------- | -- |  | ------------ | ------- |  | ------------ | - | ------ | - |  |  | ----- | --
|                                 |  | As of June 30, 2005 |         |  | As of December 31, 2004 |                      
|                                 |  |                     |         |  |                         |                      
|                                 |  | Fair Value          |         |  |                         |                       | Fair Value |              |  | 
|                                 |  | of Fixed            |         |  |                         |                       | of Fixed   |              |  | 
|                                 |  | Income              |         |  | Hypothetical            |                       |            | Hypothetical |  |  | Income    |    |  | Hypothetical |         |  | Hypothetical |  
|Percent Change in Interest Rates |  | Portfolio           |         |  | $ Change                |                       |            | % Change     |  |  | Portfolio |    |  | $ Change     |         |  | % Change     |  
|                                 |  |                     |         |  |                         |                       |            |              |  |  |           |    |  |              |         |  |              |  
|                                 |  |                     |         |  |                         | (Dollars in millions) |            |              |  |  |          
|200 basis point rise             |  | $                   | 2,185.7 |  |                         | $                     | (482.0     | )            |  |  | (18.1     | )% |  | $            | 2,073.7 |  |              | $ | (431.9 | ) |  |  | (17.2 | )%
|100 basis point rise             |  |                     | 2,403.1 |  |                         |                       | (264.6     | )            |  |  | (9.9      | )  |  |              | 2,271.5 |  |              |   | (234.1 | ) |  |  | (9.3  | ) 
|Base Scenario                    |  |                     | 2,667.7 |  |                         |                       |           |              |  |  |          |    |  |              | 2,505.6 |  |              |   |       |   |  |  |      |   
|100 basis point decline          |  |                     | 2,974.1 |  |                         |                       | 306.4      |              |  |  | 11.5      |    |  |              | 2,795.1 |  |              |   | 289.5  |   |  |  | 11.6  |   
|200 basis point decline          |  |                     | 3,342.5 |  |                         |                       | 674.8      |              |  |  | 25.3      |    |  |              | 3,110.4 |  |              |   | 604.8  |   |  |  | 24.1  |   





37



---



##### 





Disclosure about Limitations of Interest Rate Sensitivity
Analysis






Credit Risk








Equity Price Risk






38



---



##### 











Foreign Currency Risk




Investment Impairment Risk






39



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##### 





|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |           |         |           |   |         |         |         |   |    |    |    | 
|----------------------------------------- | ------------------------------------------------- | --------------------------- | ------- | ---------- | ---------------------- | - | ------- | ---------- | ------ | - | ---------- | ---------- | -- | ------------ | ------- | ------- | ---------- | - | ------- | ---------- | ------- | - | ------------ | - | - | ---------- | --------- | ------- | --------- | - | ------- | ------- | ------- | - | -- | -- | -- | 
|                                          |                                                   | Duration of Unrealized Loss |         |            |                        |   |         |            |       
|                                          |                                                   |                             |         |            |                        |   |         |            |       
|                                          |                                                   | Less than 12 Months         |         |            | Greater than 12 Months |   |         | Total      |       
|                                          |                                                   |                             |         |            |                        |   |         |            |       
|                                          |                                                   |                             |         | Gross      |                        |   | Number  |            |        |   |            | Gross      |    |              | Number  |         |            |   |         | Gross      |         |   | Number       |  
|                                          |                                                   |                             |         | Unrealized |                        |   | of      |            |        |   |            | Unrealized |    |              | of      |         |            |   |         | Unrealized |         |   | of           |  
|                                          |                                                   | Fair Value                  |         |            | Depreciation           |   |         | Securities |        |   | Fair Value |            |    | Depreciation |         |         | Securities |   |         | Fair Value |         |   | Depreciation |   |   | Securities |          
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|Fixed income securities investment grade: |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |           |         |           |   |         |         |         |   |    |   
|                                          | United States government agencies and authorities |                             | $       | 437,145    |                        |   | $       | (2,053     | )      |   |            | 9          |    |              | $       | 428,858 |            |   | $       | (400       | )       |   |              | 4 |   |            | $         | 866,003 |           |   | $       | (2,453  | )       |   |    | 13 |   
|                                          | States, municipalities and political subdivisions |                             |         | 1,559      |                        |   |         | (31        | )      |   |            | 2          |    |              |         | 28,169  |            |   |         | (233       | )       |   |              | 3 |   |            |           | 29,728  |           |   |         | (264    | )       |   |    | 5  |   
|                                          | All other corporate                               |                             |         | 492        |                        |   |         | (6         | )      |   |            | 1          |    |              |         | 165,150 |            |   |         | (14,157    | )       |   |              | 1 |   |            |           | 165,642 |           |   |         | (14,163 | )       |   |    | 2  |   
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|                                          |                                                   | Total investment grade      |         |            | 439,196                |   |         |            | (2,090 | ) |            |            | 12 |              |         |         | 622,177    |   |         |            | (14,790 | ) |              |   | 8 |            |           |         | 1,061,373 |   |         |         | (16,880 | ) |    |    | 20 | 
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|Fixed income securities                   |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |           |         |           |   |         |         |         |   |    |   
|                                          | Non-investment grade:                             |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |           |         |           |   |         |         |         |   |    |    |   
|                                          | All other corporate                               |                             |         | 18,249     |                        |   |         | (1,669     | )      |   |            | 4          |    |              |         | 93,073  |            |   |         | (27,847    | )       |   |              | 5 |   |            |           | 111,322 |           |   |         | (29,516 | )       |   |    | 9  |   
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|Total fixed income                        |                                                   |                             | 457,445 |            |                        |   | (3,759  | )          |        |   | 16         |            |    |              | 715,250 |         |            |   | (42,637 | )          |         |   | 13           |   |   |            | 1,172,695 |         |           |   | (46,396 | )       |         |   | 29 |   
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|Common stocks, at fair value              |                                                   |                             | 200,789 |            |                        |   | (32,060 | )          |        |   | 4          |            |    |              | 63,995  |         |            |   | (11,809 | )          |         |   | 1            |   |   |            | 264,784   |         |           |   | (43,869 | )       |         |   | 5  |   
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          
|Totals                                    |                                                   | $                           | 658,234 |            |                        | $ | (35,819 | )          |        |   | 20         |            |    | $            | 779,245 |         |            | $ | (54,446 | )          |         |   | 14           |   |   | $          | 1,437,479 |         |           | $ | (90,265 | )       |         |   | 34 |   
|                                          |                                                   |                             |         |            |                        |   |         |            |        |   |            |            |    |              |         |         |            |   |         |            |         |   |              |   |   |            |          










|                 |                        
|---------------- | -----------------------
|PART I  Item 4. | Controls and Procedures

Evaluation of disclosure controls and
procedures.


Changes in internal controls over financial
reporting.




40



---



##### 






PART II  OTHER INFORMATION







|                  |                  
|----------------- | -----------------
|PART II  Item 1. | Legal Proceedings








|                  |                                                                
|----------------- | ---------------------------------------------------------------
|PART II  Item 2. | Unregistered Sales of Equity Securities and Use of
    Proceeds



| |                                      
| | -------------------------------------
| | Issuer Purchases of Equity Securities



|                         |  |              |   |     |               |                  |   |             |                |  |                 |     |  |  |         | 
|------------------------ |  | ------------ | - | --- | ------------- | ---------------- | - | ----------- | -------------- |  | --------------- | --- |  |  | ------- | 
|                         |  |              |   |     |               | Total Number     |   |             |               
|                         |  |              |   |     |               | of Shares        |   |             | Maximum Number | 
|                         |  |              |   |     |               | Purchased as     |   |             | of Shares that | 
|                         |  |              |   |     |               | Part of Publicly |   |             | may yet be     | 
|                         |  | Total Number |   |     | Average Price |                  |   | Announced   |                |  | Purchased Under |    
|                         |  | of Shares    |   |     | Paid Per      |                  |   | Plans or    |                |  | the Plans or    |    
|Period                   |  | Purchased    |   |     | Share         |                  |   | Programs(1) |                |  | Programs        |    
|                         |  |              |   |     |               |                  |   |             |                |  |                 |    
|April 1  April 30, 2005 |  |              |  |     |               |                  |  |             |                |  |                |     |  |  | 564,600 | 
|May 1  May 31, 2005     |  |              |  | (2) |               |                  |  | (2)         |                |  |                | (2) |  |  | 564,600 | 
|June 1  June 30, 2005   |  |              |  | (2) |               |                  |  | (2)         |                |  |                | (2) |  |  | 564,600 | 
|                         |  |              |   |     |               |                  |   |             |                |  |                 |    
|Total                    |  |              |  |     |               |                  |  |             |                |  |                |     |  |  |         | 
|                         |  |              |   |     |               |                  |   |             |                |  |                 |    






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The Odyssey Re Holdings Corp. stock repurchase program was
    publicly announced on December 19, 2003. It was effective
    as of such date and expires two years following such date. Under
    the announced repurchase program, the Company may repurchase up
    to 1,000,000 shares of its common stock from time to time,
    in the open market, through block trades or otherwise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|(2) | In May and June 2005, we repurchased $8.5 million and
    $9.8 million aggregate principal amount, respectively, of
    our 4.375% convertible senior debentures due 2022
    (Convertible Debt), in open-market transactions, at
    a total average price of 111.3% of the principal amount
    purchased. On May 13, 2005, we issued $125 million
    aggregate principal amount of 6.875% senior notes due 2015.
    We intend to use the proceeds from the sale of such notes to
    redeem and/or repurchase our outstanding Convertible Debt from
    time to time and for general corporate purposes. Under certain
    circumstances, each $1,000 principal amount of Convertible Debt
    is convertible into 46.9925 shares of our common stock, and
    as a result, under such circumstances, $8.5 million and
    $9.8 million aggregate principal amount of Convertible Debt
    repurchased would be convertible into 399,671 and
    460,198 shares of our common stock. As of June 30,
    2005, there was $91.6 million principal amount of our
    Convertible Debt outstanding. For more information regarding our
    Convertible Debt, see note 8 to our consolidated financial
    statements included herein.






|                  |                                
|----------------- | -------------------------------
|PART II  Item 3. | Defaults Upon Senior Securities








|                  |                                                    
|----------------- | ---------------------------------------------------
|PART II  Item 4. | Submission of Matters to a Vote of Security Holders



41



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##### 





|                     |  |     |            |          |  |  |           | 
|-------------------- |  | --- | ---------- | -------- |  |  | --------- | 
|Directors            |  | For |            | Withheld
|                     |  |     |            |         
|V. Prem Watsa        |  |     | 62,018,447 |          |  |  | 934,534   | 
|James F. Dowd        |  |     | 62,095,847 |          |  |  | 857,134   | 
|Andrew A. Barnard    |  |     | 62,095,947 |          |  |  | 857,034   | 
|Frank B. Bennett     |  |     | 62,839,125 |          |  |  | 113,856   | 
|Anthony F. Griffiths |  |     | 61,463,540 |          |  |  | 1,489,441 | 
|Robbert Hartog       |  |     | 62,822,740 |          |  |  | 130,241   | 
|Samuel A. Mitchell   |  |     | 62,097,167 |          |  |  | 855,814   | 
|Brandon W. Sweitzer  |  |     | 62,839,725 |          |  |  | 113,256   | 






|                  |                                                   
|----------------- | --------------------------------------------------
|PART II  Item 5. | Other Information  Forward Looking
    Statements





| |   |                                                                                                                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | a reduction in net income if our loss reserves are insufficient;                                                                                                                                                             
|
| |  | the occurrence of catastrophic events with a frequency or
    severity exceeding our estimates;                                                                                                                              
|
| |  | the lowering or loss of one of our financial or claims-paying
    ratings, including those of our subsidiaries;                                                                                                              
|
| |  | an inability to realize our investment objectives;                                                                                                                                                                           
|
| |  | a decrease in the level of demand for our reinsurance or
    insurance business, or increased competition in the industry;                                                                                                   
|
| |  | emerging claim and coverage issues, which could expand our
    obligations beyond the amount we intend to underwrite;                                                                                                        
|
| |  | a change in the requirements of one or more of our current or
    potential customers relating to counterparty financial strength,
    claims-paying ratings, or collateral requirements;                                    
|
| |  | actions of our competitors, including industry consolidation,
    and increased competition from alternative sources of risk
    management products, such as the capital markets;                                           
|
| |  | the risk that ongoing regulatory developments will disrupt our
    business or mandate changes in industry practices in a fashion
    that increases our costs or requires us to alter aspects of the
    way we do business;
|
| |  | risks relating to our controlling stockholders ability to
    determine the outcome of our corporate actions requiring board
    or stockholder approval;                                                                   
|
| |  | changes in economic conditions, including interest rate,
    currency, equity and credit conditions which could affect our
    investment portfolio;                                                                         
|
| |  | risks related to covenants in our debt agreements;                                                                                                                                                                           
|
| |  | our inability to access our subsidiaries cash;                                                                                                                                                                              
|
| |  | loss of services of any of our key employees;                                                                                                                                                                                
|
| |  | risks related to our use of reinsurance brokers;                                                                                                                                                                             

42



---



##### 





| |   |                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | risks related to our computer and data processing systems;                                                                                                                                                                    
|
| |  | failure of our reinsurers to honor their obligations;                                                                                                                                                                         
|
| |  | the passage of federal or state legislation subjecting our
    business to additional supervision or regulation, including
    additional tax regulation, in the United States or other
    jurisdictions in which we operate;
|
| |  | risks associated with the growth of our specialty insurance
    business and the development of our infrastructure to support
    this growth;                                                                                
|
| |  | operational and financial risks relating to our utilization of
    program managers, third-party administrators, and other vendors
    to support our specialty insurance operations; and                                     
|
| |  | acts of war, terrorism or political unrest.                                                                                                                                                                                   








|                  |         
|----------------- | --------
|PART II  Item 6. | Exhibits

| |       |  |  |                                                                                                                                                                                                                                                 
| | ----- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4.7   |  |  | Global Security dated May 13, 2005, representing
    $125 million aggregate principal amount of
    6.875% Senior Notes due 2015                                                                                                                
| | *31.1 |  |  | Certification of President and Chief Executive Officer pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                            
| | *31.2 |  |  | Certification of Executive Vice President and Chief Financial
    Officer pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002                                                                                                         
| | *32.1 |  |  | Certification of President and Chief Executive Officer pursuant
    to 18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002                                                                         
| | *32.2 |  |  | Certification of Executive Vice President and Chief Financial
    Officer pursuant to 18 U.S.C. Section 1350, as adopted
    pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                          
| | 99.1  |  |  | Risk Factors (incorporated into Part II of this
    Form 10-Q by reference to the section entitled Risk
    Factors in the registrants Annual Report on
    Form 10-K filed with the Securities and Exchange Commission
    on March 7, 2005)






|  |                
|- | ---------------
|* | Filed herewith.

43



---



##### 






SIGNATURES




|                     |  |                                                                                                    
|-------------------- |  | ---------------------------------------------------------------------------------------------------
|                     |  | Odyssey Re Holdings Corp.                                                                          
|                    
|                    
|                    
|Date: August 8, 2005 |  | By /s/ Andrew A.
    BarnardAndrew
    A. BarnardPresident and Chief Executive Officer             
|                    
|                    
|                    
|Date: August 8, 2005 |  | By /s/ Robert GiammarcoRobert
    GiammarcoExecutive Vice President and
    Chief Financial Officer

44