HEALTHY NUMBERS FROM VIENNA INSURANCE GROUP

Austrian insurer Vienna Insurance Group (VIG) has posted a net profit after minorities of €408.53m ($540m) for 2008, up from €312.62m in 2007. Earnings per share rose to €3.41, from €2.98 the previous year. Gross written premiums, boosted by acquisitions during the year, were up 14.3% to €7.90bn. The combined ratio was 96.4%, up from 95.5% in 2007. VIG declared an unchanged dividend of €1.10 a share, plus a bonus dividend of €0.90 per share, payable on October 27 2009. Ralph Hebgen of investment bank Keefe, Bruyette & Woods said the bank believed that “the payout ratio of 63%, clearly exceeding the historical range of 30% to 40%, demonstrates that Vienna has confidence in the strength of its balance sheet and asset quality at a time that investors are understandably concerned about the capitalization of the insurance industry”. VIG said that, in spite of the difficult economic environment, it expected a growth in premiums in 2009, but declined to be more specific “due to the very volatile exchange rate development of the CEE markets”. KBW concluded that, although VIG had released “an excellent set of results”, it also felt that VIG also “leaves important questions unanswered for the time being”.