Greenwich lean times appear to be a thing of the past as Chris Wheal discovers when he talks to director Tim Gunter...

As every Hans Christian Andersen fan knows, there once was an ugly duckling who grew into a beautiful swan. It's a transformation many would envy but few achieve.

It is hardly surprising that the environment of Lloyd's should be the breeding ground for such changes. The shake-up of the Lloyd's regime has been mirrored by Lloyd's trading companies. Greenwich is one example. In just four years, it has moved from being a members' agent to a managing agent and, finally, to an integrated spread vehicle. In another year it hopes to be a fully fledged Lloyd's Integrated Vehicle.

Greenwich started life in 1996, formed from four members' agents, Kershaw, Castle, Marlborough and Holman, giving it a capacity for 1997 of £405m. In 1997 it launched the first conversion vehicle for Names switching from their traditional unlimited liability roles.

But Greenwich also reckons it set the standard for how to set up such a company. It's conversion vehicle (called Grenville) was a geared scheme in order to retain a low level of funding. It achieved this by buying reinsurance that was, in effect, a letter of credit worth £2.4m. The scheme, which had a capacity of £9.6m and 26 Names, is now fully paid up.

A year later, in 1998, the directors of Greenwich sold the members' agency to the conversion scheme. Director Tim Gunter says the idea was "to completely align the management with our clients".

Each year has seen a new scheme started – imaginatively called Grenville II, Grenville III and Grenville IV. The year 1998 also saw other developments. Greenwich bought a small, 18-month-old managing agency called Service. With it came syndicate 1222. "It was just a small motor syndicate and it was clean – it had no historic liabilities," says Gunter. For 2000, 1222's capacity is £21.7m. The managing agency and syndicate are also owned by the shareholders of the conversion vehicle. Again, Greenwich claims this was a model followed by others.

In the summer of last year, Greenwich bought two syndicates from the troubled Chartwell group. It then merged the two syndicates, folding 947 into non-marine syndicate 994 covering contingency, property, accident and health, giving it a £60m capacity for 2000.

"We had the funding to support it," says Gunter. "The vast majority of that £60m is from our own funding so we are effectively a fully integrated vehicle." And Greenwich reinforced that in March this year when it sold off its remaining members' agency business (for the Names who rejected conversion) to Hampden.

The plan for the future is to grow 994 into new areas to create a fully composite syndicate. "We will look to acquire other syndicates with good books of business," says Gunter. "We want to make it a composite syndicate as these are able to perform through different market conditions."

Grenville II will pay up this year, giving Greenwich about £20m in cash, with a similar sum due over the following two years.

Gunter expects shares in the vehicle to be more actively traded after that, but with a potential £139m from 325 Names, the firm can double its underwriting capacity without looking for more capital from new shareholders.

By 2001, Greenwich intends to be fully integrated Lloyd's vehicle. That would be the fairytale ending.