Swiss Re Ag · SIX:SREN

Swiss Re — Vontobel Summer Conference 2005

29 slides from Swiss Re's conference presentation, Jun 2, 2005

  1. Slide 1: Vontobel Summer Conference

    Vontobel Summer Conference Pierre L. Ozendo Member of the Executive board Head of Asia Division Interlaken, 2 June 2005

  2. Slide 2: Cautionary note on forward-looking statements

    Cautionary note on forward-looking statements Certain statements contained herein are forward-looking. These statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical fact or current fact. Forward- lo

  3. Slide 3: Agenda

    Agenda „ Swiss Re: A global company „ Strategic priorities – Focus: Extend leadership in Asia „ The Chinese market and Swiss Re's position „ Conclusions and outlook Vontobel Summer Conference Interlaken, 2 June 2005 Slide 3

  4. Slide 4: Swiss Re's history

    Swiss Re’s history 1863 Foundation of the company 1906 San Francisco Earthquake, Swiss Re establishes its reputation 1910 First branch office in New York 1950-1956 Opening of offices in South Africa, Canada, Australia, Hong Kong 1968-1976 Creation of several advisory and service companies in Asia an

  5. Slide 5: Swiss Re at a glance

    Swiss Re at a glance Net income = CHF 2.5 billion Premiums earned = CHF 29.4 billion Total investments = CHF 98.5 billion Leading position in P&C reinsurance: 11% market share* Leading L&H reinsurer: 22% market share* Leading provider of Financial Services solutions to targeted clients Highly divers

  6. Slide 6: Swiss Re headlines in 2004

    Swiss Re headlines in 2004 Net income of CHF 2.5 billion, up 45% ROE increased to 13.6%, above the three year average target of 13% ROI of 5.8% generated with an investment portfolio of 95% invested in bonds and real estate Business Groups: – P&C: combined ratio of 98.4% unchanged from 2003 despite

  7. Slide 7: Risk is a growth business

    Risk is a growth business: Reinsurance outpaced insurance and GDP growth CAGR Annual growth 1990 - 2004E; nominal values ‘91-’04 ‘05-’15* 450 Swiss Re. 11.3% ?% Life reins. 11.1% 6.5% 400 350 300 Non-life reins. 6.8% 5.1% 250 6.3% 6.9% Life ins. Non-life ins. 5.8% 5.3% 200 GDP 4.6% 5.7% 150 100 1990

  8. Slide 8: Highly diversified reinsurer with comprehensive product range

    Highly diversified reinsurer with comprehensive product range Earnings history in CHF bn 1997 1998 1999 2000 2001 2002 2003 2004 CAGR Total revenues 20.3 22.7 25.7 31.6 34.1 34.4 36.4 36.1 17.5% „ Origin of world reinsured risks 2003: 55% 35% 10% „ Swiss Re’s gross premium written by 53% 35% 12% reg

  9. Slide 9: Swiss Re's mission: to be the authority on managing capital and risk

    Swiss Re’s mission: to be the authority on managing capital and risk Our goals „ Be the global market leader in P&C and L&H reinsurance „ Be the premier provider of capital, risk and asset management solutions in business-to-business financial services with a specific focus on insurance and other fi

  10. Slide 10: Structures and responsibilities adapted to fit strategic objectives I

    Structures and responsibilities adapted to fit strategic objectives I (News release 2 June 2005) „ Swiss Re will structure itself into three management functions to be named Client Markets, Products and Financial Services Accelerating the Cycle management Growth (incl. Asia) balance sheet Stefan Lip

  11. Slide 11: Structures and responsibilities adapted to fit strategic objectives II

    Structures and responsibilities adapted to fit strategic objectives II (News release 2 June 2005) „ The Client Markets function (Jacques Aigrain) – Four divisions: Americas, Europe, Asia and Globals & Large Risks – Divisions will drive Swiss Re’s growth across all lines of business „ The Products fu

  12. Slide 12: Agenda

    Agenda „ Swiss Re: A global company „ Strategic priorities – Focus: Extend leadership in Asia „ The Chinese market and Swiss Re's position „ Conclusions and outlook Vontobel Summer Conference Interlaken, 2 June 2005 Slide 12

  13. Slide 13: Swiss Re's strategic priorities

    Swiss Re’s strategic priorities I. Actively manage the cycle for profits II. Optimise organic and transactional growth Excellence in execution III. Extend leadership in Asia IV. Accelerate the balance sheet through risk securitisation Vontobel Summer Conference Interlaken, 2 June 2005 Slide 13

  14. Slide 14: Insurance market: growth above GDP, particularly in emerging markets

    Insurance market: Growth above GDP, particularly in emerging markets Life: premiums 2003: USD 1 528bn Non-life: premiums 2003: USD 1079bn Growth in excess of GDP p.a., 1980-2006* Growth in excess of GDP p.a., 1980-2006* 700 300 8% 600 250 500 400 200 2.2% 300 150 3% 200 0.9% GDP 100 100 GDP Forecast

  15. Slide 15: Attractive growth opportunities in emerging markets

    Attractive growth opportunities in emerging markets „ Step change in demand Premiums per GDP, life and non-life, 2003 function. When GDP per 12% capita gets close to USD 10 000, insurance 10% penetration rises to a United States level above 4% with a 8% steep slope Germany „ Compulsory insurance 6%

  16. Slide 16: Organisational structure aligned with strategy I

    Organisational structure aligned with strategy I Beijing Seoul Tokyo Shanghai Taipei Mumbai Hong Kong Manila Bangalore Kuala Lumpur Hauptsitz China Singapore Hongkong Swiss Re service company Sydney Vontobel Summer Conference Melbourne Interlaken, 2 June 2005 Swiss Re representative office Slide 16

  17. Slide 17: Extending Swiss Re's leadership position in Asia

    Extending Swiss Re’s leadership position in Asia „ Branch network strategy „ Cost management focus: – Bangalore Shared Service Centre „ Product development for emerging markets „ Investing in talent and training „ Revenue/profit growth and securitisation Vontobel Summer Conference Interlaken, 2 June

  18. Slide 18: P&C and L&H BG growth in Asia

    P&C and L&H BG growth in Asia Swiss Re initiatives Growth: 48% in Asia 3 000 CAGR: 14% „ Expanded Swiss Re’s local 2 500 Net premiums earned (CHFm) presence through additional branch offices 2 000 „ Swiss Re Asia Emerging Market 1 500 Training Initiative 1 000 500 0 2001 2002 2003 2004 Vontobel Summ

  19. Slide 19: Agenda

    Agenda „ Swiss Re: A global company „ Strategic priorities – Focus: Extend leadership in Asia „ The Chinese market and Swiss Re's position „ Conclusions and outlook Vontobel Summer Conference Interlaken, 2 June 2005 Slide 19

  20. Slide 20: Swiss Re: a long relationship with China

    Swiss Re : a long relationship with China „ 1930: First reinsurance contracts signed „ 1956: Office opened in Hong-Kong „ 1973: First reinsurance contract between Swiss Re and People’s Insurance Company of China (PICC) „ 1995/1996: Rep offices in Beijing and Shanghai „ 2002: Asia divisional headquar

  21. Slide 21: China: key challenges

    China: key challenges „ Natural catastrophe coverage including pools „ Growth of environmental concerns „ Other compulsory coverages, e.g. public liability, motor liability, etc. „ Further market reforms and corporate governance „ Capital market development and expansion „ The consequences of desoci

  22. Slide 22: Current market potential: Still untapped to a large extent

    Current market potential: Still untapped to a large extent Insurance penetration 2003, % 14% 12% Taiwan USD 10 bn non-life 10% premiums in South Korea Singapore 2003 8% India Japan 6% Australia Hong Kong USD 10 bn South Korea life 4% Australia Malaysia premiums in Japan Hong Kong China 2003 2% Thail

  23. Slide 23: Future market potential: By 2015 Chinese insurance industry as big as Germany's?

    Future market potential: By 2015 Chinese insurance industry as big as Germany’s? USD billions 600 500 400 300 200 100 0 China China Japan Japan Germany Germany 2004 2015 2004 2015 2004 2015 Vontobel Summer Conference Life insurance Non-life insurance Interlaken, 2 June 2005 Slide 23 Source: Swiss Re

  24. Slide 24: Recent Swiss Re initiatives in China

    Recent Swiss Re initiatives in China „ National Peoples’ Congress: Catastrophe Pool system „ Liability conferences in Beijing and Shanghai „ Casualty product development in cooperation with CIRC „ First foreign shareholder in Chinese insurance asset management company (partner: China Re) „ Targeted

  25. Slide 25: Results to date – and future outlook

    Results to date – and future outlook „ Premium growth 1993 - 2003: 18% p.a. (real) „ Total premiums Greater China 2004: CHF 430m „ P&C renewals 05 vs 04: Substantial growth in proportional business driven by new large treaties „ CAGR 2005 to 2010: double digit growth „ Adequate, quality human capita

  26. Slide 26: Agenda

    Agenda „ Swiss Re: A global company „ Strategic priorities – Focus: Extend leadership in Asia „ The Chinese market and Swiss Re's position „ Conclusions and outlook Vontobel Summer Conference Interlaken, 2 June 2005 Slide 26

  27. Slide 27: Conclusions

    Conclusions „ Swiss Re has the financial strength, product knowledge and people skills to capture Asia’s market potential „ Risk continues to be a growth industry, particularly in emerging Asian markets „ Swiss Re successfully manages the cycle through its ability to diversify across products and ma

  28. Slide 28: Target matrix

    Target matrix Individual growth targets replaced by overall growth in EPS target Avg target Business targets Key figures 2004 2005/06 Property & Casualty Combined ratio 98.4% 96% Life & Health Return on operating revenues 9.1% 9% Financial Services Premium business, traditional: Combined ratio 92.9%

  29. Slide 29: Outlook

    Outlook „ P&C: Assuming a normal claims burden, Swiss Re expects combined ratio for 2005 to be in the region of 96% „ L&H: Attractive opportunities for expansion of Admin ReSM, return on revenues above 9% „ FS: Expansion of ILS and fee income „ Investments: Long term rates expected to rise especiall

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