Converium reports huge losses for 2001

Converium was listed on the Swiss stock exchange in December, 2001 Keystone

The Converium reinsurance company of Zurich has reported a loss of $367.4 million (SFr609.15 million) for last year.

The former Zurich Reinsurance business, which went public last December, said in a statement on Monday that losses from the September 11 terrorist attacks in the United States were $289.2 million.

Analysts say this is low compared with losses suffered by other reinsurance companies.

Converium said it was only “marginally exposed” to asbestos and environmental claims in the US, and was only affected in a limited way by the collapse of the Enron corporation.

The company said it had signed contracts for 73 per cent of its premium volume that was renewable from January 1, 2002 and experienced combined increases in rates and shares of about 25 per cent.

Converium, which earlier announced it was not proposing a dividend for 2001, said net premiums last year were up by 24 per cent to $2.48 billion.

Strong client focus

“Converium entered 2002 as an established and integrated leading global reinsurer with a strong client focus and determination to deliver shareholder value,” commented CEO Dirk Lohmann.

“We were well received as an independent company during the recent January 1, 2002 renewal season by both clients and brokers,” he added.

The company’s chief financial officer, Martin Kauer, said Converium had a very solid balance sheet and was strongly capitalised.

“Due to our strict financial discipline in underwriting, we expect sharp improvements in margins for 2002,” he commented.

Converium’s 2001 loss was at the upper end of the range forecast by analysts (SFr251 – SFr368 million).

The initial public offering (IPO) of Converium took place on December 11 and involved the placing of 35 million registered shares priced at SFr82 per share or $24.59 per American Depositary Share (ADS) with investors worldwide.

The company ranks eighth among the top ten reinsurers and employs about 750 people in 24 offices worldwide.