Insurance

Axa bid offers arbitrage gamble

18 Sep 2003

The outcome of the French insurer s bid for Mony is in doubt following opposition from the US company s shareholders. The convertible bond issued to fund the bid represents a chance to lay a wager on Axa s chance of success.

Axa to pay $1.5bn for US rival

18 Sep 2003

The puzzle is why MONY has agreed to sell out for a measly 6% premium. Rivals will be running the numbers to see if they can pay more. Small wonder that Axa is being coy about the potential for cost savings.

Munich Re admits HVB exposure is too big

11 Sep 2003

The world s largest reinsurer has said its strategic relationship with HVB does not require it to hold a 26% stake in the German bank. But finding a way of realising good value from this stake won't be easy and, in any case, won't change the need for a rights issue.

Aviva launches £1.2bn hybrid capital issue

10 Sep 2003

The UK life insurer was first with its dividend cut. Now it is leading the pack in tapping the debt markets early after the summer break. Aviva hasn't spoilt the market for others. Demand for hybrids is so strong that rivals should find it easy to follow suit.

Swiss Life back in the black

10 Sep 2003

After multiple disappointments, Switzerland's largest life assurer has delivered a nice surprise. Its turnaround is gathering pace. And despite the latest rally, it is not hard to see further upside to the shares.

Munich Re’s rights issue will be sooner not later

9 Sep 2003

Standard & Poor's has given the German reinsurer a healthy sixmonth window to raise capital and avoid another humiliating downgrade. But for all its protests to the contrary, Munich Re would benefit from a rights issue as soon as possible and has an excuse for one.

RSA pays over the top for underwriting

8 Sep 2003

The insurer is paying £48m in fees for its £1bn rights issue, even though the shares are being sold at a thumping discount. The theoretical cost of a put option on its shares at such a discount would have been a tiny fraction of this.

RSA puts gun to investors’ head

4 Sep 2003

The £744m gap in the UK insurer's reserves is much bigger than feared. That's why the discount on its £1bn rights issue is much deeper than expected. That will force shareholders to cough up.

RAS has more cash than it knows what to do with

2 Sep 2003

With nothing much to buy on the horizon, RAS could come under pressure to return some cash to shareholders. While European rivals are passing the cap round, the Italian insurer has some E900m of excess capital.

Royal & Sun Alliance gets ready for rights issue

31 Aug 2003

The British insurer has been itching to raise funds for over a year. RSA has a stronger hand now. The bet is investors will believe a rights issue is worth it.

Swiss Re H1 beats expectations

29 Aug 2003

It's little wonder that investors were cautious about the reinsurer's results following CEO John Coomber's quasi profit warning in June. But the results show that the issues Coomber highlighted are not so serious after all. He should keep his head down in future.

S&P downgrades Munich Re to A+

28 Aug 2003

A capital raising would not have averted the move. The agency s view of the reinsurer relative to its peers has clearly deteriorated. Munich Re has declared war on S&P. If the rating agency is taking a harsher view of the whole industry, the fireworks are just beginning.

Munich Re tests S&P’s patience

26 Aug 2003

The German reinsurer was spared a downgrade in June. Instead, S&P issued a verbal warning that more capital would be needed before long. But Munich Re is still procrastinating over a capital increase. That can only be justified if its operating performance has gathered pace.

Lloyds learns to live with Scottish Widows

22 Aug 2003

Eric Daniels, the UK bank s CEO, seems open to serious offers for the life business. But he is taking care not to look like a forced seller. Sticking with the business and fixing it may not be his first choice solution, but that s what management is all about.

Zurich Financial posts patchy first half

20 Aug 2003

One year on, and the insurance company's turnaround programme is delivering in most, if not all, areas. Zurich appears to be on track to sustain its return to profitability. The question is what it does for an encore.

Allianz posts Q2 net income of E622m

14 Aug 2003

The equity rally and a huge tax credit have helped the German insurer to overturn a firstquarter loss and enter the black at the halfyear. But Allianz wants to be judged on its operational performance. And it is not obvious that this justifies a terribly high rating.

Insurers pull rabbits out of the hat

14 Aug 2003

Allianz posted an interim profit by conjuring up a E850m tax credit. ING, its Dutch rival, unearthed E250m to boost its results. It just shows that the one thing you will never get out of an insurance company is a clean set of numbers.

Herbert Walter takes axe to Dresdner

14 Aug 2003

The bank s new boss has little choice. Dresdner s results may have stabilised in the first half. But its income is under pressure and costs remain too high.

Axa first-half earnings beat expectations

12 Aug 2003

Investors who have pushed up the insurer's shares this year have been rewarded with a dazzling result from its general insurance business. But the core life business is awaiting an upturn in consumer confidence.

Aegon sells financing arm to GE for $5.4bn

5 Aug 2003

Perhaps Aegon is worried that markets are heading down again. Selling the financing business will cut debt and cement its credit rating. And Aegon has even managed to make a profit despite selling to General Electric.