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Swiss Re confirms heavy losses and writedowns

The world's second-largest reinsurer, Swiss Re, has announced a net full year loss of SFr864 million ($735 million) and SFr5.9 billion in writedowns for 2008.

The writedowns forced the Zurich-based Swiss Re earlier this month to take a SFr3 billion investment from billionaire Warren Buffett's Berkshire Hathaway group on what analysts have described as unattractive terms.

The group is also proposing a SFr2 billion capital boost from a rights offer to existing shareholders.

Swiss Re said on Thursday that it aims to save SFr200 million in costs in 2009 and SFr400 million by the end of 2010.

Shares in Swiss Re, which is disbanding its financial markets activities, have dropped by about two thirds so far this year.

The company last week attempted to steer its way back to reinsurance basics by replacing its chief executive, Jacques Aigrain, with industry veteran Stefan Lippe.

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