MUNICH, April 30 (Reuters) - Munich Re expects net profit to fall by around 7 percent in the first quarter from a year earlier, as low capital market interest rates continue to weigh on investment income.
Munich Re will report quarterly earnings on May 8.
“Net profit is likely to come in at around 900 million euros ($1.24 billion) in the first quarter,” Munich Re Chief Executive Nikolaus von Bomhard said in the text of a speech at the reinsurer’s annual shareholder meeting.
Von Bomhard reiterated Munich Re’s goal of earning 3 billion euros in net profit this year and repeated that the target was “ambitious” in the face of sinking yields on the reinsurer’s stock of fixed-income investments.
The world’s largest reinsurer posted net profit of 970 million euros in the first quarter of 2013 and 3.3 billion euros in the full year.
Munich Re has felt increasing price competition when annual reinsurance contracts with insurance company clients were renewed in April but has fared better than the overall market, von Bomhard said. ($1 = 0.7237 Euros) (Reporting by Joern Poltz, writing by Jonathan Gould, editing by Thomas Atkins)