QBE at top of the global tree
The QBE Group is now one of the best-performing insurers in the world, according to CFO Neil Drabsch.
Speaking in Sydney last week at a Macquarie Bank conference, he said QBE has provided a weighted average return on equity over the past five years of 24% – placing it at the top of the global list for insurers.
And the weighted average of QBE’s combined operating ratio over the past five years is 87.9%, placing it behind only behind US-based FM Global (81.2%) and Danish insurer Tryg Vesta (85.9%).
Mr Drabsch was addressing concerns raised by investors particularly related to QBE’s capital adequacy and its exposure to dud mortgage loans following the acquisition of major regional insurer PMI.
QBE has a capital base of $8.843 billion, more than twice the minimum capital requirement, and Mr Drabsch says PMI – now known as QBE LMI – has been a “consistently profitable residential lenders mortgage insurer for over 40 years”.
Last year QBE LMI returned gross earned premium of $203 million and has a 2009 target of $207 million.
Looking ahead, Mr Drabsch says QBE expects overall rate increases this year of 4%. He says there are “indications of a hardening market”, but QBE remains cautious of the impact of the economic downturn.
And the group’s “acquisition pipeline” will increase this year as the prices for businesses reduce.
Business commentators say Mr Drabsch’s “focus on the numbers” last week reassured the sharemarket that QBE is performing well in a difficult environment. The group’s share price immediately rose 71 cents to $22.40 – its highest level since mid-February.
Speaking in Sydney last week at a Macquarie Bank conference, he said QBE has provided a weighted average return on equity over the past five years of 24% – placing it at the top of the global list for insurers.
And the weighted average of QBE’s combined operating ratio over the past five years is 87.9%, placing it behind only behind US-based FM Global (81.2%) and Danish insurer Tryg Vesta (85.9%).
Mr Drabsch was addressing concerns raised by investors particularly related to QBE’s capital adequacy and its exposure to dud mortgage loans following the acquisition of major regional insurer PMI.
QBE has a capital base of $8.843 billion, more than twice the minimum capital requirement, and Mr Drabsch says PMI – now known as QBE LMI – has been a “consistently profitable residential lenders mortgage insurer for over 40 years”.
Last year QBE LMI returned gross earned premium of $203 million and has a 2009 target of $207 million.
Looking ahead, Mr Drabsch says QBE expects overall rate increases this year of 4%. He says there are “indications of a hardening market”, but QBE remains cautious of the impact of the economic downturn.
And the group’s “acquisition pipeline” will increase this year as the prices for businesses reduce.
Business commentators say Mr Drabsch’s “focus on the numbers” last week reassured the sharemarket that QBE is performing well in a difficult environment. The group’s share price immediately rose 71 cents to $22.40 – its highest level since mid-February.