The world's second-largest reinsurer, Swiss Re, has reported a surprise loss of SFr304 million ($259 million) in the third quarter, hurt by investment losses.This content was published on November 4, 2008 - 11:06
The Zurich-based company also announced on Tuesday that it was suspending its share buyback programme because of high financial volatility and a significant increase in demand for reinsurance.
In a statement, Swiss Re said it wrote down another SFr572 million on investments and reported a SFr289 million loss on credit derivatives.
It's the first time the company has posted red figures for almost six years. Analysts polled by Reuters had expected a net profit of SFr236 million.
Swiss Re has been hurt more than its competitors by the financial crisis, writing down about SFr3 billion on investments in its financial services unit, which creates products to transfer risk to capital markets.
The reinsurer estimated its net claims from Hurricane Ike at $315 million, against a previous estimate of $250 million, adding that aggregate net claims for hurricanes Ike and Gustav would be around $365 million.
"The company delivered awful figures," commented analyst Fabrizio Croce at Kepler Capital Markets in Zurich. He added that Tuesday's writedown was "only the tip of the iceberg – the present is cloudy and the future looks stormy".