German reinsurer Munich Re, which yesterday named a new chief executive, has warned profits this year will be lower than in 2015, as the reinsurance market has to grapple with an environment of continued low interest rates, while competition remains as fierce as ever.
Munich Re is guiding shareholders that its profits this year will fall within a range of €2.3–€2.8bn from €3.1bn last year. Chief executive Nikolaus von Bomhard, who will step down next year, said even this target was “ambitious”.
Munich Re cautioned of lower profits this year as it also announced it would buy back a further €1bn in shares before its annual meeting next year.
Mr von Bomhard, said:
We are aiming for a consolidated result of €2.3–2.8bn for 2016. On account of continuing low interest rates and intensive competition in reinsurance, this is an ambitious target – especially because we cannot expect to see a repeat of the below-average expenditure for natural catastrophe claims that we had in 2015.
The reinsurer yesterday named Joachim Wenning, who has been at Munich Re since 1991, as Mr von Bomhard’s replacement.
Source: Fast FT