Swiss Re Ag · SIX:SREN
Swiss Re — FY2007 Earnings Presentation
11 slides from Swiss Re's earnings presentation, May 6, 2008
Slide 1: Economic Value Management (EVM) 2007 results
ab Economic Value Management (EVM) 2007 results Analyst and investor conference call Zurich, 06 May 2008 ab EVM methodology EVM is Swiss Re’s integrated economic measurement and steering framework used for planning, pricing, reserving and managing the business – Splits performance of fund raising
Slide 2: EVM 2007 income statement
ab EVM 2007 income statement CHF m 2006 2007 Profit New business profit 3 010 784 Previous years business profit 690 909 Total profit after capital costs 3 700 1 693 Release of capital costs 3 541 3 196 Income before capital costs 7 241 4 889 Strong underwriting results were partially offset by in
Slide 3: EVM 2007 key drivers: Property & Casualty and Life & Health
ab EVM 2007 key drivers Property & Casualty New business – EVM profit on new business up 4%, driven by low natural catastrophe loss levels partially offset by lower volumes in casualty Previous years business – Property and Specialty generated an EVM profit of CHF 1 387 million, reflecting impro
Slide 4: EVM 2007 key drivers: Financial Markets
ab EVM 2007 key drivers Financial Markets Credit & Rates reported an EVM loss of CHF -1 613 million, mainly attributable to widening credit spreads and the impact of lower risk- free interest rates on a short duration position relative to the benchmark Equities & Alternative Investments reported
Slide 5: EVM 2007 key drivers: Group items; EVM balance sheet
ab EVM 2007 key drivers Group items New business – EVM profit on new business is CHF 70 million, reflecting the result of various corporate centre positions and other items excluded from business segment performance measures Previous years business – EVM profit on previous years business is CHF
Slide 6: Group economic net worth
ab EVM 2007 Group economic net worth Group economic net worth (ENW) is the difference between the Overall economic market value of assets and the economic value of liabilities balance sheet ENW is the EVM estimate of shareholders’ funds Economic Market liabilities value assets CHF bn Economic ne
Slide 7: Economic net worth roll forward; required capital by segment
ab EVM 2007 economic net worth roll forward CHF bn 50 4.9 40 39.2 -1.2 -1.3 -2.2 38.4 -1.0 30 20 10 0 Published ENW Opening B/S Income 2007 Dividend payment Share repurchase Other incl. FX on ENW 2007 2006 adjustments 2007 and MCS ENW conversions The EVM production process is not subject to the sa
Slide 8: Sensitivities: goals, methodology and group sensitivities
ab EVM 2007 sensitivities Goals and methodology Overall economic EVM sensitivities illustrate the impact on actual EVM figures to changes balance sheet in EVM key parameters. EVM sensitivities are estimated on the following basis: Market Economic value liabilities Changes are applied in isolation
Slide 9: Sensitivities: Life & Health specific
ab EVM 2007 sensitivities Life & Health specific (1) Change in economic Change in 2007 net worth as of CHF bn new business profit 31.12.2007 Life & Health specific sensitivities Reduce lapse rates by 10% (e.g. from 8% to 7.2%) 0.0 0.9 Mortality and morbidity rates reduced by 5% – Mortality 0.2 3.5 –
Slide 10: Sensitivities: Property & Casualty; corporate calendar & contacts
ab EVM 2007 sensitivities Property & Casualty Change in economic Change in 2007 net worth as of CHF bn new business profit 31.12.2007 Property & Casualty specific sensitivities Change in weighted average term to settlement – Increase by 10% 0.1 0.8 – Decrease by 10% -0.1 -0.8 Projected future claims
Slide 11: Cautionary note on non-GAAP financial measures
Cautionary note on ab non-GAAP financial measures This presentation on Economic Value Management (“EVM”) contains non- GAAP financial measures. EVM is not based on US GAAP, which are the principles in accordance with which Swiss Re prepares its financial statements, and should not be viewed as a sub