Insurance giant Swiss Life posted Friday a first-half drop in net profit to 361 million francs (301 million euros, $371 million) that nonetheless beat market forecasts.
Analysts had pencilled in profits closer to 309 million francs. Falling demand in the group’s key sectors was countered by increasing profitability, with operating profit up 17 per cent to 528 million francs despite a 2.6 per cent fall in premiums to 9.8 billion francs.
Swiss Life managing director Bruno Pfister said he was very happy with business in the first half of the year despite historically low interest rates and “continuing volatility” in the market place.
“That shows that we have been able to make our sales model tougher in recent years,” he said.
AWD, the group’s German financial services provider, saw net profits sink 63 per cent to 6 million francs and commission income fall 18.6 per cent to 275 million francs.
Its contribution to group earnings fell to 13.1 million euros after it set aside more than nine million euros for litigation.
Market analysts from Swiss private bank Notenstein called the Zurich-based insurer’s results “solid”. Investors would be happy about the group’s decent operating profit figures and its plans to make savings of up to 400 million francs by the end of the year, Notenstein said, but Swiss Life “needed to find a solution for” AWD by either restructuring or selling part of the business.
Shares in Swiss Life were up 3.1 per cent to 105 francs in afternoon trading amid general market gains of 0.46 per cent.
Zurich, Aug 17, 2012 (AFP) a
