Munich Re Expects 'Satisfactory' First Quarter

NU Online News Service, April 22, 12:19 p.m. EDT

In advance of its first-quarter report next month Munich Re said recent catastrophe losses have been manageable and it expects results to be "satisfactory."

According to a company statement reporting his remarks at a shareholders meeting in Munich today, Nikolaus von Bomhard, Munich Re chairman, said, "Although the picture is not yet complete, a satisfactory result is emerging."

"On the one hand, we had to absorb further strains on our investment result in the difficult capital markets," he said. "On the other hand, the performance of our underwriting business was pleasing, with manageable major losses from natural catastrophes."

Mr. von Bomhard said reinsurance terms and conditions generally have not involved rate increases, but "they have definitely done so in specific segments–especially covers for natural catastrophes."

The company said it will pay an unchanged dividend of EUR5.50 ($7.16) per share for 2008. Munich Re reported for the year its profit has been EUR1.5 billion ($1.95 billion)–a 61 percent decline attributed to investment declines.

But, Mr. von Bomhard said, "we have been able to manage the financial crisis comparatively well to date." And the reinsurer has "consistently practiced what we preach in our risk management, which is deeply ingrained in our day-to-day business."

Munich Re will publish first-quarter figures May 6.