Switzerland's largest life insurer, Swiss Life, says it is to concentrate on its core life insurance business and focus on Switzerland and certain European markets.
The company also announced that 700 jobs are to go as part of its efforts to restore profitability - 500 of them in Switzerland.
Swiss Life on Wednesday reported a first-half loss of SFr386 million ($255 million), well down on the restated SFr1 million loss - from a SFr253 million profit - reported for the corresponding period last year.
The Zurich-based company called the result "unsatisfactory on the whole" and said that the figures were due to huge depreciation charges.
"The first half loss was mainly due to the weak financial markets and to our write-offs on Banco del Gottardo and STG," CEO Roland Chlapowski told swissinfo.
The staff cuts, which come on top of the 800 job losses revealed in April, are to be implemented by 2004. The company said they would be achieved through natural turnover and redundancies.
Chlapowski said that Swiss Life would be refocusing on its core business of life insurance.
"We have come up with this new strategy because the financial markets are very volatile and we want to have a system that allows us to have profit without counting on the performance of the markets," he explained.
"We are convinced that we have growth potential with our core business, and we believe if we focus we will be profitable."
As part of this new strategy, Swiss Life said it planned to sell its French and Belgian non-life insurance operations and its group banking businesses.
But the company said it would only be selling up in the medium term, due to unfavourable market conditions.
"There is no market for these companies right now," said Chlapowski. "And we don't want to make a fire sale. Since the market is depressed there is no price and no buyers for these assets right now."
The insurer also stated that it would be concentrating on the domestic market in Switzerland and on France, Germany, Belgium, the Netherlands and Luxembourg where it enjoys a good market position.
It said that it would no longer be operating in the UK, Italy or Spain.
Swiss Life said that shareholder equity had fallen to SFr3.9 billion by the end of the first six months of 2002.
It added that the firm's operating profit before goodwill charges was SFr500 million, but that it had made a writedown on its STG and Banca del Gottardo business of SFr624 million.
The company once again reiterated plans for a capital increase and said that it was also planning to switch from a parent company structure to a holding company structure.
The measures will be discussed at the meeting for shareholders on 23 October.
Swiss Life confirmed earlier in the week that it is considering raising an extra SFr900 million ($594 million) to SFr1.2 billion through a rights issue.
Switzerland's oldest insurer has endured a tough year in which shares fell by more than 80 per cent amid concern from investors about insurance companies' exposure to weak equity markets.
Swiss Life, which employs 12,700 people in more than 50 countries, has been undergoing a review of its operations and strategy since the appointment of Chlapowski as CEO earlier this year.
swissinfo with agencies
Established in 28 September 1857 by Conrad Widmer in Zurich.
It is Switzerland's oldest private life insurance company.
More than 12,700 employees worldwide.
No.1 in Switzerland and one of Europe's leading life insurers.
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