Munich Re finance chief sees consolidation among small reinsurers - paper

FRANKFURT, April 12 Sat Apr 12, 2014 8:49am EDT

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FRANKFURT, April 12 (Reuters) - The current low interest rate environment, a slump in prices and tighter regulation could lead to consolidation among smaller reinsurance companies, the finance director of Munich Re, the world's biggest reinsurer, told a German daily.

"The pressure to merge tends to be rising," Joerg Schneider said in an interview published on Saturday by Boersen-Zeitung.

"Perhaps there will be pressure to consolidate among the smaller companies," he said. "But among the larger re-insurers I do not expect mergers because these could entail a significant business loss," he added.

The pricing pressure in the reinsurance industry is a temporary development and demand will increase again markedly in the medium-term, he said, without being more specific about timeframe.

Touching on developments in the first quarter, Schneider said Munich Re had seen lower claims burdens from major losses, "something which will have a positive impact" on financial results. (Reporting by Marilyn Gerlach; Editing by Pravin Char)