ING Canada Inc. reported net income of $109.4 million for the quarter ended Dec. 31, 2006, down from $196.9 million reported in the same quarter last year.

Direct premiums written for the quarter were $963.6 million, an increase of 4.6% over the fourth quarter of 2005 after adjusting for industry pool premiums.

Net income for the full year 2006 was $658.1 million compared to $781.8 million in 2005. Direct premiums written for the year amounted to $3.99 billion, a 2.7% increase over 2005 after adjusting for AGR and industry pool premiums.

“Overall, our insurance businesses performed well throughout 2006 although profitability for the quarter reflects lower underwriting results and a decrease in realized investment gains. Underwriting results for the quarter were adversely affected by weather-related catastrophes and lower favourable prior year claims development,” said Claude Dussault, president and CEO, in a news release.

“However, despite a challenging fourth quarter, ING Canada demonstrated its ability during the year to provide continued value to its shareholders, with net income of $658.1 million generating a return on equity of 20.8%.”

ING Canada also announced that the company will increase its quarterly dividend by 2¢ to 27¢ a share on its outstanding common shares. The dividend will be payable on March 30 to shareholders of record on March 15.

The company also announced its intention to repurchase for cancellation up to $50 million of its common shares through use of a substantial issuer bid, by way of a modified Dutch Auction. ING Groep, ING Canada’s majority shareholder, has informed ING Canada of its intent to submit common shares sufficient to maintain its holding at 70%.