Zurich Insurance CEO Steps Down--Update

By John Letzing

ZURICH-- Zurich Insurance Group AG capped a tumultuous period for the Swiss insurer on Tuesday, by parting ways with Chief Executive Martin Senn.

The Zurich-based company said Mr. Senn will step down by the end of this year. He will be replaced on an interim basis by Chairman Tom de Swaan, while a permanent successor is sought.

Mr. Senn, who joined Zurich Insurance in 2006 as chief investment officer before later assuming the CEO role in 2010, oversaw the company through a trying period that included the tragic death of a top executive, a series of management changes, and a recent retreat from a significant acquisition.

During a conference call with reporters, Mr. de Swaan thanked Mr. Senn for having "guided Zurich through a challenging environment." The company will pursue external candidates for the CEO job, Mr. de Swaan said, while declining to lay out a timetable for the search.

Mr. Senn, a former executive at Credit Suisse Group AG and Swiss Life Holding AG, held the top job at Zurich Insurance during an unusually difficult chapter in its 143-year history.

In June, Zurich Insurance said Chief Risk Officer Axel Lehmann was stepping down, and would be replaced by the company's chief investment officer.

Then in the following month, Zurich Insurance unveiled a bold plan to bolster its business: the acquisition of U.K.-based RSA Insurance Group PLC, potentially valued at more than $8 billion.

In early September, the company said the CEO of its general insurance unit, Mike Kerner, was being replaced by Kristof Terryn--a Zurich Insurance executive who had been running the global life business. Roughly two weeks later, Zurich Insurance called off its pursuit of RSA, citing mounting troubles at the general insurance unit.

At that same time, the company warned that it would report a weaker-than-expected third-quarter profit for general insurance.

Mr. Senn said during the conference call on Tuesday that the profit warning, in addition to the company's need to back away from the RSA acquisition, were factors in his decision to step aside.

Last month, Zurich Insurance reported a 79% decline in third-quarter net profit, and an operating loss of $183 million for the general insurance business in the period. The company said it would cut roughly 200 jobs at the general insurance unit.

Mr. de Swaan said on Tuesday that despite the recent turmoil, the company remains "on track." By early next year, he said, Zurich Insurance should detail its plans for deploying roughly $3 billion in excess capital.

In February of last year, Zurich Insurance warned that it expected about $600 million in charges related to restructuring its business. The following month, the company said it planned to shed as much as 1.5% of its workforce in a bid to cut costs. The company later reported a 3% decline in net profit for 2014.

And back In August, 2013, the company was shaken by the suicide of Chief Financial Officer Pierre Wauthier, who left behind a note blaming the company's then-chairman, Josef Ackermann, for creating an unbearable work culture. Mr. Ackermann issued a statement rejecting blame for Mr. Wauthier's death, and abruptly resigned. He was replaced by Mr. de Swaan. The episode rattled investor confidence.

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

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

December 01, 2015 05:26 ET (10:26 GMT)

Zurich Insurance (QX) (USOTC:ZURVY)
Historical Stock Chart
From Jun 2024 to Jul 2024