SWISS RE OFFERS SHARE BUYBACK AND INCREASED DIVIDEND

Swiss Re pleased the markets this morning with the announcement that it would be buying back shares for up to SFr6bn over the next three years. It also announced a 36% increase in its dividend to SFr3.40 a share. The company’s share price reacted well to the news, rising 4.23% to SFr108.40 in mid-morning trade. Swiss Re’s earned non-life premiums for 2006 were up 7% to SFr18.5bn and the combined ratio fell to 90.4% from 112.3%. in 2005. CFO Ann Godbehere, who steps down today, said that premiums without the GE Insurance Solutions purchase would have been roughly flat. For the group, premiums earned were up 10% to SFr29.5bn, generating a net income up 98% to SFr4.56bn. The integration of GE Insurance Solutions’ 3,300 staff resulted in an increase of staff numbers to 10,891 from 2005’s 8,882. Swiss Re announced last July that there would be up to 2,000 lay-offs as a result of the takeover. The first stage of the share buyback will be to repurchase 16.65m shares from GE, half the latter’s current stake in Swiss Re, between today and March 10. These shares will be proposed for cancellation at the next Swiss Re AGM. Swiss Re said that it was maintaining its target of earnings per share growth of 10% and of a 13% return on equity throughout the cycle. For 2006 the RoE was 16.3%.