Swiss Re Cuts Dividend as Fourth-Quarter Profit Misses Estimates

by swisscham in Bank, Finance, Insurance

Swiss Re AG, the worldÕs second-biggest reinsurer, lowered its dividend payout to investors after fourth-quarter profit declined 80% on charges related to the restructuring of the U.S. business. The Zurich-based company plans to pay shareholders a dividend of CHF 4.25 (USD 4.52) a share, up from CHF 3.85 distributed for 2013, it said in a statement Thursday. On top of that, it proposed a special dividend of 3 francs, down from 4.15 francs a year ago. In addition, Swiss Re plans to buy back CHF 1 billion of its shares by the 2016 shareholder meeting. Swiss Re, led by Chief Executive Officer Michel Lies, is cutting back coverage of catastrophes like hurricanes and earthquakes amid a decline in the incidence of natural disasters that has undercut prices. In a quest for alternative sources of revenue, it is ramping up new lines of business, such as corporate insurance and coverage in Asia, to bolster earnings eroded by low interest rates. It is also expanding in markets including China, where in July it agreed to acquire Sun Alliance Insurance (China) Ltd.

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