Swiss Re Lifts Profit But Warns of Hefty China Claim

ZURICH—Swiss Re AG on Thursday reported increased profit for the third quarter, even as the reinsurance giant detailed losses expected as a result of the deadly explosion in August at a port in Tianjin, China.

Zurich-based Swiss Re said it expects a pretax loss of roughly $250 million related to the disaster. In September, Zurich Insurance Group AG said it expected losses of about $275 million related to the explosion, which was caused by the improper storage of hazardous chemicals and killed more than 100 people.

Swiss Re's net profit rose to $1.4 billion in the third quarter from $1.23 billion in the same period last year, in part because of the absence of large natural catastrophes. Premiums and fee income fell to $7.85 billion from $8.31 billion, Swiss Re said.

Return on equity was 17.3% in the quarter, up from 14.8% a year earlier.

Swiss Re's results this year have been solid, "especially when taking into account the overall insurance market, which continues to be challenging," chief financial officer David Cole told reporters.

Swiss Re said it would start a share buyback program next month, which it initially unveiled earlier this year. Mr. Cole said details of the buyback are forthcoming.

The reinsurance firm's largest unit, the property and casualty business, reported that net profit rose to $1.01 billion in the third quarter from $842 million in the same period last year. That came even as premiums earned fell to $4.1 billion from $4.3 billion. Swiss Re said the business benefited from strong investment returns.

Swiss Re's Admin Re business, which has been in the process of a revamp and is acquiring U.K.-based Guardian Holdings Europe Ltd. as part of that effort, reported that net profit fell to $21 million in the quarter from $54 million in the same period last year. The company cited a poor investment performance in the U.K. market.

Separate from its financial results, Swiss Re said its board will propose Paul Tucker, a former deputy governor of the Bank of England, as a new director at the firm's annual shareholder meeting next year.

Write to John Letzing at john.letzing@wsj.com

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(END) Dow Jones Newswires

October 29, 2015 05:15 ET (09:15 GMT)

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