(Bloomberg) -- Swiss Re AG namedChristian Mumenthaler, a 17-year veteran of the company who headsthe main reinsurance unit, as chief executive officer fromJuly 1. He will succeed the retiring Michel Lies.

Mumenthaler, 46, has held several posts on the company’sexecutive committee, including that of chief risk officer. Thereinsurance unit he led generates about 85% of the company’srevenue, Swiss Re said in a statement Tuesday. No decision has beenmade yet on a successor for Mumenthaler.

“Although we did not expect this announcement today, we are notsurprised by the succession, William Hawkins and Rufus Hone,analysts at Keefe, Bruyette and Woods, said in a note to clients.“Mumenthaler is well-known to the investment community already andhas had a number of important roles at Swiss Re. We view thisorderly succession favorably.”

Swiss Re fell as much as 2.8% in Zurich trading and was down1.5% at 92.05 francs ($92.76) as of 9:45 a.m. The stock is up7% over the last 12 months.

Reinsurers including Munich Re, Swiss Re and Hannover Re sellbackup coverage to insurance companies, protecting them against bigrisks such as natural disasters. While losses from catastropheslast year fell to the lowest since 2009, earnings in the industrycontinue to be squeezed by record-low interest rates and decliningprices for coverage.

Fourth-quarter net income rose to $938 million from $245 milliona year earlier, when earnings were hit by one-time charges. Thatexceeded the $915.6 million average estimate of eight analystssurveyed by Bloomberg.

Despite the positive earnings, Swiss Re’s stock will facecontinuing pressure due to overcapacity in the industry and anegative outlook for prices, Baader Helvea analyst Daniel Bischofwrote in a note to investors. Swiss Re Chief Financial OfficerDavid Cole also said he expects continued price pressure, though itwill probably diminish.

Dividend increase

Swiss Re increased its dividend to 4.6 francs, compared with aBloomberg estimate of 4.5 francs. Last year, the company paid out aregular dividend of 4.25 francs and a special dividend of 3 francs.The reinsurer on Tuesday also announced plans for a share buybackof up to 1 billion francs to deploy its excess capital.

Related: Reinsurance revolution: Shaping the market of thefuture

Net income at the property & casualty reinsurance unit fellto $703 million from $1.2 billion a year earlier. Profit in thefourth quarter was hit by flood loses losses in the U.K. and India,Swiss Re said. The unit’s combined ratio rose to 89.6% from 86.7%in the fourth quarter. A ratio greater than 100 means that aninsurer is paying more in claims and costs than it is collecting inpremiums.

Munich Re, Swiss Re’s biggest competitor, saidearlier this month that prices in its non-life reinsurance businessdeclined by about 1% in January, when slightly more than half ofthat business was up for renewal.

Swiss Re’s full-year net income jumped 31% to $4.6 billion, or$13.44 a share.

“The result is still solid, there were no large claims,” saidStefan Schuermann, an analyst at Vontobel with a hold rating on thestock. “They have a strong balance sheet that leaves room forfurther capital action.”

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