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Financials

UPDATE 1-Munich Re upbeat after 30 pct jump in Q3 net profit

* Q3 net profit 684 mln euros vs Rtrs poll avg 688 mln

* Now sees 2016 net profit well above 2.3 bln euro target

* Says pricing pressure has eased slightly (Adds comments on pricing, Hurricane Matthew)

LONDON, Nov 9 (Reuters) - German reinsurer Munich Re posted a 30 percent gain in net profit in the third quarter, slightly below expectations, but was upbeat on earnings for the year after being conservative in its underwriting and suffering few large loss claims.

Quarterly net profit came in at 684 million euros ($770 million), a touch below the 688 million euros that had been expected according to the average forecast in a Reuters poll of banks and brokerages.

The world’s largest reinsurer guided to “well over” its previous full-year goal of earning 2.3 billion euros in net profit.

“Munich Re is well on track with this quarterly profit of almost 700 million euros”, Chief Financial Officer Joerg Schneider said in a statement on Wednesday.

“We are now more optimistic about our profit guidance.”

The reinsurer posted net profit of 2.1 billion euros for the first nine months, though this was down from 2.4 billion in the year-earlier period.

Shares in Munich Re fell 4.6 percent in pre-market trade, underperforming a 3.4 percent decline in Germany’s blue-chip index.

Analysts at KBW retained their underperform rating on the stock.

“Today’s results have missed consensus slightly and the raised outlook for 2016 net attributable earnings should already be in expectations,” they said in a note.

Munich Re said it would stick to strict underwriting discipline, though it said pressure on prices, terms and conditions had eased off slightly in the last few renewal rounds.

The $600 billion reinsurance industry, which provides a backstop to insurers, helping them pay for damage claims from hurricanes or earthquakes, faces its fifth year of falling premiums.

New investors are looking to compete for reinsurance business, including through so-called catastrophe bonds, amid low returns in more traditional investment markets.

A relatively benign period of natural catastrophes in developed markets has also put pressure on the prices insurers are willing to pay for reinsurance.

Munich Re said its guidance took into account Hurricane Matthew, which hit the United States and Caribbean last month with insured losses estimated at up to $8 billion.

The reinsurer anticipated its own losses for the hurricane in the low triple-digit million euro range.

$1 = 0.8886 euros Reporting by Carolyn Cohn; Editing by Maria Sheahan

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