Posted on 18 Apr 2012
Swiss Re reiterates the focus on its 2011 - 2015 financial targets at its London Investors' Day today and says it is well positioned to benefit from unique business opportunities. The new structure enables Swiss Re to achieve better accountability and transparency and to improve decisively its capital management by redeploying capital to opportunities that offer higher returns.
Michel M. Liès, Swiss Re's Group Chief Executive Officer, says: "We continue to manage the Swiss Re Group along our existing strategy, with a focus on our strong client franchise, best-in-class underwriting and prudent asset management. Unique growth opportunities and the dynamic set-up of our three Business Units – Reinsurance, Corporate Solutions and Admin Re® – mean that we are well positioned to outperform the market."
Excellent opportunities to deploy capital?Swiss Re has excellent opportunities to deploy capital across the three Business Units in developed and emerging markets. Together with regulatory changes, Swiss Re believes, this will create the ideal conditions for Swiss Re to outperform.
George Quinn, Swiss Re's Group Chief Financial Officer, says: "The new segmental structure improves the transparency of Swiss Re's Business Units and increases earnings visibility. Furthermore, the new set-up enables the movement of capital in the Group towards those areas with higher returns, both through new business decisions and by extracting dividends from existing portfolios."
Financial targets are Swiss Re's top priority?Achieving the Swiss Re Group's 2011-15 financial targets is the company's top priority. Each of the Business Units – Reinsurance (P&C and L&H), Corporate Solutions and Admin Re® – is committed to achieving the financial targets and, by doing so, contributing to the Group targets.
• P&C Reinsurance: A further firming of the reinsurance cycle is expected to drive margin improvements. In addition, Swiss Re intends to deploy capital to take advantage of unique opportunities and the possibilities for growth offered by developed and emerging markets.
• L&H Reinsurance: Margins, driven by new business, are expected to improve and dividends paid to the Group from existing business will contribute towards the company's overall targets.
• Corporate Solutions: A niche player, Corporate Solutions offers a key opportunity for significant and profitable growth off a stable capital base with the aim to be a focused, global player in large commercial business.
• Admin Re®: By focusing on cash generation and dividends to the holding company, Admin Re® supports the Group while maintaining its goal to be a recognised force in the closed life book market.
Focus on active capital management at Group level?George Quinn says: "The new financial segments allow us to significantly and decisively improve capital management. Excess capital is distributed across all segments but will move up to the Group level. P&C Reinsurance and Corporate Solutions are likely to redeploy more capital as the market improves and large transactions are completed while L&H Reinsurance and Admin Re® will likely increase dividends paid to the Group. The new structure will allow us to be flexible, adjusting our capital allocation to achieve the highest returns."
Proven underwriting, risk and asset management framework?Underwriting, risk management and asset management are key enabling units in the new set-up and run across the Business Units, providing consistency and ensuring that Swiss Re's hallmarks are maintained. Swiss Re benefits from best-in-class people and systems and a deep expertise in Research & Development that provides a competitive advantage. The new structure allows the company to operate in a more agile and innovative way, while ensuring that Group oversight is maintained.
"Swiss Re is well positioned to achieve its financial targets, based on its ample capacity for new business opportunities in developed and emerging markets, its leadership in underwriting competence, as well as a prudently positioned asset portfolio, thus offering a unique proposition to shareholders," concludes Michel M. Liès.