for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Financials

UPDATE 2-Swiss Re names head of reinsurance to succeed CEO

* CEO to be replaced by reinsurance head Mumenthaler on July 1

* 2015 net profit $4.6 bln vs $4.57 bln in poll

* Announces new share buyback of up to 1 bln Sfr (Adds comment from incoming CEO and analyst, market reaction and detail)

ZURICH, Feb 23 (Reuters) - Swiss Re has appointed the head of its main division to take over as CEO when Michel Lies retires in July, the world’s second-biggest reinsurer said on Tuesday after announcing a 31 percent rise in full-year net profit.

Christian Mumenthaler, 46, who has already been with the company for 17 years, said his promotion did not mark a strategic shift for the Zurich-based reinsurer.

“One thing is for sure, I think you can count on a lot of continuity,” Mumenthaler said at a results news conference.

The change at the top, to take effect on July 1, follows the successful completion of Swiss Re’s 2011-2015 financial goals which included a return on equity of at least 7 percentage points above risk-free 10-year U.S. government bonds and boosting earnings per share by an average of 10 percent each year.

News of the departure of the 61-year-old Lies, who has led the reinsurer since 2012 and been with the company for more than 35 years, was of little surprise, analysts said.

“Mumenthaler is known to the market and he has a high degree of credibility. I think it’s a perfect choice,” said Baader-Helvea analyst Daniel Bischof, who has a “hold” rating on Swiss Re’s stock.

SHARE SLIDE

Reinsurers like Swiss Re, Munich Re and Hannover Re act as a financial backstop for insurance companies, helping them pay for large damage claims from hurricanes or earthquakes in exchange for part of the premiums.

Profits in its life and health reinsurance business, which posted a loss in 2014, helped net profit for 2015 climb 31 percent to $4.6 billion, matching analysts’ forecasts. It posted a $938 million profit for the fourth quarter.

However, analysts said the fact that the bottom line was boosted by a one-off tax gain took some of the shine off the forecast-matching numbers.

Shares in Swiss Re were down 1.4 percent at 92.15 francs by 1352 GMT, when the Stoxx Europe 600 European insurance sector index was down 0.56 percent.

Swiss Re also announced plans for a share buyback of as much as 1 billion Swiss francs ($1 billion) which would be completed before its annual shareholder meeting in 2017 if excess capital was still available, there was no major loss event and the group does not find another use for the capital.

It also lifted its regular annual dividend to 4.60 Swiss francs from 4.25 francs, although that was below the 4.75 francs analysts had forecast.

$1 = 0.9953 Swiss francs Editing by Edwina Gibbs, Greg Mahlich

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up