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QBE Sees First-Half Profits Miss Company's Target

Posted on 26 Jul 2010

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QBE Insurance Group Ltd., Australia's biggest insurer by market value, fell the most in five months in Sydney trading after its first-half insurance profit margin missed the company's target range.

QBE lost 5.6 percent to A$16.97 at the close, the biggest decline since Feb. 26. The benchmark S&P/ASX 200 index climbed 0.6 percent.

The margin in the six months ended June 30 was 15.7 percent, below QBE’s 2010 target of between 16 percent and 18 percent and lower than the 17.5 percent reported a year earlier, the Sydney- based company said in a statement today.

QBE attributed the result to “the impact of lower interest yields on claims provisions, reduced yields on policyholders’ funds and the record level of catastrophes,” according to its statement.

The company, which maintained the full-year margin target, said profit after tax in the first half dropped 40 percent from A$1.02 billion ($920 million) a year ago because of lower investment income.