Munchener Ruckversicherungs-Gesellschaft AG · XETR:MUV2
Munchener Ruckversicherungs-Gesellschaft — Munich Re — Morgan Stanley European Financials Conference 2013
19 slides from Munchener Ruckversicherungs-Gesellschaft's conference presentation, Mar 19, 2013
Slide 1: Delivering growth in bottom-line results
DELIVERING GROWTH IN BOTTOM-LINE RESULTS MORGAN STANLEY „EUROPEAN EUROPEAN FINANCIALS CONFERENCE 2013“ 2013 London 19 March 2013 London, Joachim Oechslin European Financials Conference 2013 1
Slide 2: Munich Re highlights: Delivering on our promise
Munich Re highlights Delivering on our promise – Strong position for successful business development Focus on mastering industry challenges … Main drivers of future earnings growth based on our strategic thrusts Managing Active capital Strengthening the low-yield management operational environment p
Slide 3: Profitability in core business more important in times of financial repression
Disciplined asset-liability management and underwriting 1 Profitability in core business becoming even more important in times of financial repression Consistently decreasing capital market % ... compensated for by increasing earnings % yields, hence investment income … contribution from core insura
Slide 4: Investments – Striking the balance between diversification and earnings resilience
Disciplined asset-liability management and underwriting 1 Investments – Striking the balance between thorough diversification and earnings resilience Limited interest-rate sensitivity – Duration Disciplined ALM Assets Liabilities Net DV011 ((€m)) Ongoing increase of asset Reinsurance 6.7 6.1 –18.3 d
Slide 5: Core business – Steady state with best-in-class processes and prudent reserve levels
Disciplined asset-liability management and underwriting 1 Core business - Steady state with best-in-class processes and prudent reserve levels Reserving process reflected in treaty-year and financial-year loss ratio Treaty-year versus financial-year loss ratio: 2003–20121 Key developments 100% Hig
Slide 6: Strong capitalisation providing flexibility – Dividend continuity
Sound capital base 2 Strong capitalisation providing flexibility – Dividend continuity and seizing opportunities for profitable growth Strong capitalisation facilitating enabling enabling profitable business expansion capital repatriation Several options – Examples Sustainable dividend growth € Orga
Slide 7: Rock solid balance sheet reflected in favourable external perception
Sound capital base 2 Rock solid balance sheet reflected in favourable external perception … % Agency Rating Outlook Ratio: Solvency II A M Best A.M. B t A (S A+ (Superior) i ) stable t bl calibration1 226 Fitch AA– (Very strong) stable Munich Re 129 Moody’s Aa3 (Excellent) stable solvencyy ratio2 S&
Slide 8: Strong capitalisation allowing for attractive capital repatriation
Sound capital base 2 … combined with strong capitalisation allowing for attractive capital repatriation … Munich Re actions1 Munich Re solvency ratio Regulatory actions2 >120% MRCM Solvency II MCR–100% Excellent capitalisation Below target capitalisation Solvency ratio adjusted Capital repatriatio
Slide 9: Good financial results contributing to substantial long-term shareholder return
Sound capital base 2 … and good financial results contributing to substantial long-term shareholder return Return on equity in excess of cost of capital % Attractive risk/return profile1 % Total shareholder return (p (p.a.)) Average RoE: 10.9% 10 9% Average CoC2: 7.9% 15 15.3 Peer 3 14.1 12.5 12.6 1
Slide 10: Significant increase in AFR despite capital repatriation
Sound capital base 2 Significant increase in AFR despite capital repatriation and difficult economic environment AFR development 2007–2012 €bn Economic earnings €bn 4.2 –6.3 6.0 3.6 –1.2 7.1 30 9 30.9 +4 2 +4.2 –12.0 12 0 +13 4 +13.4 36 5 36.5 Confidence2 ~30% ~99% ~10% ~50% ~90% ~10% 2007 2008 2009
Slide 11: Falling interest rates leaving their mark on reinvestment yield
Stringent investment strategy 3 Falling interest rates leaving their mark on reinvestment yield – still achieving significant spread above safe haven Running yield more resilient % Reinvestment yield: Market-value-weighted excess yields % than reinvestment yield over 7-year German bunds 2011 2012 1.
Slide 12: Investment outlook – Mitigating attrition of regular income
Stringent investment strategy 3 Investment outlook – Mitigating attrition of regular income as a consequence of low interest rates ILLUSTRATIVE Expand Corporate and emerging Renewable energies/ Equities and Higher market bonds infrastructure commodities Improving yield – focus Attractive long-term C
Slide 13: Continuously improved value creation building the foundation for earnings growth
Well-balanced business portfolio 4 Continuously improved value creation building the foundation for earnings growth Reinsurance Primary insurance Munich Health (MH) Non-life – Target combined ratio Non-life international – Operating result – Apart from at attractive level Combined ratio back to norm
Slide 14: Primary life insurance: Launch of less interest-rate-prone new products
Well-balanced business portfolio – Primary insurance 4 Primary life insurance: Launch of less interest-rate-prone new products – Concept for Germany well advanced Adverse interest rate environment … ... requires action to meet stakeholder expectations 6% Shareholder Significant reduction of risk c
Slide 15: Outlook 2013
Munich Re highlights Outlook 2013 Munich Re (Group) GROSS PREMIUMS WRITTEN RETURN ON INVESTMENT NET RESULT 2012 €52bn 2012 3.9% 2012 €3.2bn Target 20131 €50–52bn Target 2013 ~3.3% Target 2013 Close to €3bn Focus on profitable growth Ongoing low interest rate RoRaC target of 15% after tax prevails –
Slide 16: Delivering growth in bottom-line results
Munich Re highlights Delivering growth in bottom-line results Good track record Successfully dealing with challenging economic conditions – We remain a strong partner for clients and reliable for shareholders, shareholders delivering on our promises Business strategy Focus on insurance F i risks i k
Slide 17: Financial calendar
Backup: Shareholder information Financial calendar FINANCIAL CALENDAR 25 April 2013 Annual General Meeting, Munich 26 April 2013 Dividend payment – Ex-dividend date 7 May 2013 Interim report as at 31 March 2013 7 August 2013 Interim report as at 30 June 2013 8 – 10 September 2013 Les Rendez-Vous de
Slide 18: For information, please contact
Backup: Shareholder information For information, please contact INVESTOR RELATIONS TEAM Christian Becker-Hussong Ralf Kleinschroth Thorsten Dzuba Head of Investor & Rating Agency Relations Tel.: +49 (89) 3891-4559 Tel.: +49 (89) 3891-8030 Tel.: +49 (89) 3891-3910 E-mail: rkleinschroth@munichre.com E
Slide 19: Disclaimer
Disclaimer This presentation contains forward-looking statements that are based on current assumptions and forecasts of the management of Munich Re. Re Known and unknown risks, risks uncertainties and other factors could lead to material differences between the forward-looking statements given here
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