Swiss Re Ag · SIX:SREN
Swiss Re — 19th BAML CEO Conference 2014
21 slides from Swiss Re's conference presentation, Oct 2, 2014
Slide 1: 19th BAML CEO Conference
19th BAML CEO Conference David Cole, Group CFO London, 2 October 2014
Slide 2: Introduction to Swiss Re
Introduction to Swiss Re BAML CEO Conference | London, 2 October 2014 2
Slide 3: Swiss Re: Differentiated through history and diversification
Swiss Re Differentiated through history and diversification • Swiss Re is a leading and highly diversified global re/insurance group, with over 60 offices in more than 20 countries • Swiss Re has both a superior capital rating and more than 150 years of experience in providing reinsurance solutions
Slide 4: Swiss Re's Group strategy
Swiss Re's Group strategy Unchanged, focus on execution Outperform our peers Strategic goal: • Reinsurance • Asset Management The leading • Admin Re® player in the Current wholesale position Smart expansion re/insurance industry • Corporate Solutions • Longevity & Health • High Growth Markets BAML C
Slide 5: Business Unit strategies
Business Unit strategies Unchanged Swiss Re Group Corporate Reinsurance Admin Re® Solutions P&C L&H Strategic goal Strategic goal Strategic goal • To be the world's • To be a focused, lean, • To be a recognised leading reinsurer global player in large force in the closed commercial business life boo
Slide 6: Competitive advantage in underwriting
Competitive advantage in underwriting A key strength of Swiss Re Portfolio Hedging R&D Innovation, 151 Years steering large and structured Capital transactions strength In an inefficient Our retro and Re/insurance is a Focus on tailored Superior balance market, skilled hedging team knowledge busines
Slide 7: Swiss Re's underwriting outperformance
Swiss Re's underwriting outperformance Swiss Re’s P&C premium and underwriting profit share vs top reinsurers 60% 50% 40% 30% 20% 10% 0% 2006 2007 2008 2009 2010 2011 2012 2013 1H14 Premiums U/W profit (green = loss) In 2011 the industry underwriting result was negative • Average premium share of 23
Slide 8: Group financial targets
Group financial targets On track ROE 700 bps above risk free EPS growth 10% average ENW per share growth plus average over 5 years (2011- annual growth rate, adjusted dividends 10% avg. annual 2015) for special dividends1 growth rate over 5 years in % in USD2 in USD2 144.5 13.0 11.9 123.1 13.4 13.7
Slide 9: Low rates and heavy regulation: how to deliver shareholder return
Low rates and heavy regulation: how to deliver shareholder return BAML CEO Conference | London, 2 October 2014 9
Slide 10: Record low interest rates
Record low interest rates Expected to stay low and increasing pressure on running yield Germany United States 7% 7% 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% Running yield of P&C insurers Running yield of P&C insurers 10y government bond yield, average of year 10y government bond yield, average of y
Slide 11: P&C underwriting
P&C underwriting Strong and stable track record 130% 5% 120% 4% 110% 114.1 101.1 96.8 98.3 98.2 97.3 95.4 100% 104.0 93.9 104.7 3% 93.1 98.4 98.4 97.9 90% 93.7 97.4 95.0 92.8 2% 90.4 90.2 80% 85.3 83.1 1% 70% 60% 0% 5-year US Treasury risk-free rates (RHS) Group combined ratio (LHS) Group combined r
Slide 12: Low inflation
Low inflation Expected to stay low; also expect continued low economic growth and interest rates 5% 4% 3% 2% 1% 0% -1% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014E 2015F Germany United States Assuming claims inflation follows general inflation we expect some continuation of positive reserve re
Slide 13: Regulatory changes around the globe
Regulatory changes around the globe… Highly complex and challenging regulatory risk landscape United States Europe • NAIC solvency modernisation, but • Solvency II: Commission rather qualitative (ORSA) delegated reg. binding technical • Establishment of Federal Standards Insurance Office (FIO) • New
Slide 14: Swiss Re is already subject to an advanced risk-based solvency regime
… Swiss Re is already now subject to an advanced economic and risk-based solvency regime Swiss solvency Test (SST) • Swiss Re has been reporting under SST since 2008 • SST applies to Swiss Re Group and all legal entities domiciled in Switzerland • SST is a risk-based economic solvency regime, incorp
Slide 15: Two frameworks guide Swiss Re's capital management
Two frameworks guide Swiss Re's capital management Group risk tolerance and target capital structure principles Group risk tolerance Target capital structure • Risk tolerance represents the amount of risk Swiss Re • Swiss Re's target capital structure is willing to accept within the constraints impo
Slide 16: Internal & external dividends since 2012
Internal & external dividends since 2012 USD 7.0bn dividends paid to shareholders since implementation of new Group structure As of 30 June 2014 USD 7.0bn distribution to shareholders Swiss Re Ltd USD 5.3bn USD 2.7bn USD 0.8bn USD 1.8bn Corporate Reinsurance Admin Re® Solutions P&C L&H • Group risk
Slide 17: Summary
Summary • Swiss Re differentiates through history, knowledge and diversification • Swiss Re delivers strong and stable track record • More restrictive solvency regimes around the globe provide business opportunities for Swiss Re • EVM is the basis for SST • USD 7bn dividends paid to shareholders sin
Slide 18: Q&A
Q&A BAML CEO Conference | London, 2 October 2014 18
Slide 19: BAML CEO Conference | London, 2 October 2014
BAML CEO Conference | London, 2 October 2014 19
Slide 20: Corporate calendar & contacts
Corporate calendar & contacts Corporate calendar 2014 7 November Third Quarter 2014 results Conference call 2015 19 February Annual Results 2014 Conference call 18 March Publication of Annual Report 2014 and EVM 2014 21 April 151st Annual General Meeting Zurich Investor Relations contacts Hotline E-
Slide 21: Cautionary note on forward-looking statements
Cautionary note on forward-looking statements Certain statements and illustrations contained herein are forward-looking. These statements (including as to plans objectives, targets and trends) and illustrations provide current expectations of future events based on certain assumptions and include an