Swiss Re profits tumble on bad investments
Swiss Re has confirmed the worst, last week announcing a net loss of CHF864 million ($1.14 billion) for 2008 – driven largely by bad investment strategies.
Earlier this month the reinsurance giant flagged an unaudited loss of CHF1 billion ($1.3 billion), and announced the departure of CEO Jacques Aigrain.
New CEO Stefan Lippe says the 79% fall in annual net profit is “clearly disappointing”.
“Although our property and casualty and life and health business segments continue to perform extremely well even in these adverse conditions, the result has been impacted by investment losses,” he said.
Property and casualty lines returned operating income of CHF2.7 billion ($3.6 billion), a 39% decrease compared to 2007. The combined ratio was a marginally profitable 97.9%.
The reinsurer has employed extensive hedging initiatives to reduce investment risk and has discontinued disastrous credit default swap investments that contributed to a mark-to-market loss of CHF5.9 billion ($7.8 billion) last year.
Earlier this month the reinsurance giant flagged an unaudited loss of CHF1 billion ($1.3 billion), and announced the departure of CEO Jacques Aigrain.
New CEO Stefan Lippe says the 79% fall in annual net profit is “clearly disappointing”.
“Although our property and casualty and life and health business segments continue to perform extremely well even in these adverse conditions, the result has been impacted by investment losses,” he said.
Property and casualty lines returned operating income of CHF2.7 billion ($3.6 billion), a 39% decrease compared to 2007. The combined ratio was a marginally profitable 97.9%.
The reinsurer has employed extensive hedging initiatives to reduce investment risk and has discontinued disastrous credit default swap investments that contributed to a mark-to-market loss of CHF5.9 billion ($7.8 billion) last year.