Swiss Re poised for deals, but in no hurry
MONACO, Sept 8 (Reuters) - Swiss Re (RUKN.VX) could take advantage of the credit crunch by snapping up more insurance portfolios from cash-strapped banks, but is in no hurry to do deals, Chief Financial Officer George Quinn said on Monday.
The world's second-largest reinsurer is poised to do more deals like its acquisition last month of British bank Barclays' (BARC.L) life assurance portfolio for around $1.5 billion in cash to boost the revenues of its Admin Re business.
The unit acquires closed-life insurance businesses and seeks to make money from them by exploiting economies of scale in servicing these books of business and by managing better the vast pool of assets they bring.
Swiss Re is moving capital away from the non-life reinsurance market, where prices are falling, and may use the cash to exploit attractive opportunities in Admin Re, Quinn said at a press conference on the fringes of an industry meeting.
"If we take capital out of the (property/casualty) business then we can redeploy that elsewhere. You've seen an example of that in the Barclays transaction. Given the availability of assets at interesting prices in the admin re market that's something we can continue to do if we choose," Quinn said.
Banks who have taken a pounding from the subprime mortgage crisis are willing sellers.
"There are a number of factors driving the market but it's fairly obvious that some of the owners of businesses that would be ideal for us are financial services firms which are under considerable capital strain or stress," said Quinn.
"This is the type of environment to find the right kind of returns for our shareholders."
But he added there was no need to act hastily, as the environment was not set to change soon.
"I suspect the kind of conditions that we see today are likely to persist for some time to come, so to be quite frank, we don't feel in a particular hurry," said Quinn.
"But it's nice to be able to redeploy capital in this way for these sort of returns."
(Editing by Sue Thomas)
