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Swiss Re makes surprise Q2 net loss

The Swiss Reinsurance Company has reported a surprising second-quarter loss of SFr381 million ($359.5 million) as investment losses and impairments hit the firm.

This content was published on August 5, 2009 - 08:49

This compares with a SFr564 million profit made in the comparable period last year.

Swiss Re, the world's second-largest reinsurer by premiums, said in a statement on Wednesday that the net loss was mainly caused by charges on several of its products.

However, company CEO Stefan Lippe said that core business in the second quarter, despite the loss, "continued to deliver strong underwriting results and solid earnings power".

Swiss Re said its property and casualty business deliver "excellent" underwriting business. Operating income in the division rose 11 per cent to SFr1 billion in the quarter.

But the company's life and health sectors were affected by the markets and produced an operating loss of SFr10 million, compared with a profit of SFr535 million between April and June last year.

In its outlook Swiss Re was cautious. The economic environment remains uncertain and the company's investment and legacy portfolios remain exposed to market volatility, the statement said.

The financial market volatility and the shift towards lower risk investments, which allowed Swiss Re to reduce its exposures significantly, may adversely impact future earnings, it added.

swissinfo.ch and agencies

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