Swiss Re posts smaller-than-expected 85% profit drop in H1

Swiss Re (SRENH.S) posted a smaller-than-expeced 85% fall in net profit in the first half of the year, the reinsurance company said on Friday, in a period hurt by the effect of the war in Ukraine and volatile markets.

Chief Executive Christian Mumenthaler said meeting full-year targets was “highly dependent” on how financial markets perform and the outcome later this year of big claims, like those for hurricanes and other catastrophes.

Net profit of $157 million during the first six months compares with a net profit of $1 billion a year earlier. It was better than analysts’ expectations for a profit of $62 million.

Last year, the Zurich-based company recovered from a pandemic-related loss in 2020, but the war in Ukraine has become a major headwind for the reinsurer as it set aside reserves for the war during the first three months of the year.

The reinsurer said that it nevertheless returned to profit in the second quarter, helped by a decline in deaths from the pandemic.