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AIG Sells Stakes in 3 Solar Power Plants in Spain: "American International Group has sold its shares in three solar power plants in Spain that already are generating electricity for the grid.
The company’s AIG Financial Products Corp. said Wednesday the three plants have a combined generation capacity of 35.4 megawatts and a total value of about €300 million ($404 million). HgCapital, a private equity firm in London, bought the stakes for an undisclosed amount of money.
HgCapital said it bought the interests not only from AIG but also from 360 Corporate, an investment bank in Spain. The acquisition is HgCapital’s first in the solar energy sector, the firm said. The power plants were installed before the Spanish government lowered its solar energy subsidies last fall. HgCapital, which also invests in wind power, said two of the plants have a fix-axis design while the third uses a single-axis tracker system (18MW).
AIG’s spokesman Mark Herr said via email that the operators of those power plants are City Solar, Proener and SunPower (SPWRA). SunPower, based in San Jose, Calif., makes solar panels and single-axis trackers, and it engineers and develops solar power projects. The three power plants are located in the regions of Extremadura, Murcia and Castilla-La Mancha, Herr said."
For Source and Full Article Visit: Seeking Alpha
19 March 2009
Regulators: AIG Not Using Bailout Funds to Underprice Insurance
Regulators: AIG Not Using Bailout Funds to Underprice Insurance: "Despite some complaints by competitors, American International Group (AIG) does not appear to be using federal bailout funds to lower its insurance prices to keep and attract business, state and federal officials told a House subcommittee today.
Representatives for the Government Accountability Office (GAO), which was asked by Congress to investigate the allegations of unfair pricing, and the National Association of Insurance Commissioners (NAIC), told lawmakers that they have not found enough evidence to conclude that the bailout funds triggered by AIG's financial products unit have been of any direct benefit to the insurance operations.
Orice M. Williams, director of Financial Markets and Community Investment for GAO, and Pennsylvania Insurance Commissioner Joel Ario, representing the NAIC, however, indicated that their monitoring of the pricing situation is ongoing and their results are preliminary.
The GAO testimony and that of Ario on behalf of the NAIC were presented before the House Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises today. AIG CEO Edward Liddy is also scheduled to appear before the subcommittee today.
Williams did suggest the property/casualty and life insurance operations of AIG may have received some indirect benefit 'to the extent that the property/casualty insurers would have been adversely affected by a credit downgrade or failure of the AIG parent.'
She said that some of AIG's competitors claim that AIG's commercial insurance pricing is out of line with its risks but other insurance industry participants and observers disagree."
For Source and Full Article Visit: Insurance Journal
Representatives for the Government Accountability Office (GAO), which was asked by Congress to investigate the allegations of unfair pricing, and the National Association of Insurance Commissioners (NAIC), told lawmakers that they have not found enough evidence to conclude that the bailout funds triggered by AIG's financial products unit have been of any direct benefit to the insurance operations.
Orice M. Williams, director of Financial Markets and Community Investment for GAO, and Pennsylvania Insurance Commissioner Joel Ario, representing the NAIC, however, indicated that their monitoring of the pricing situation is ongoing and their results are preliminary.
The GAO testimony and that of Ario on behalf of the NAIC were presented before the House Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises today. AIG CEO Edward Liddy is also scheduled to appear before the subcommittee today.
Williams did suggest the property/casualty and life insurance operations of AIG may have received some indirect benefit 'to the extent that the property/casualty insurers would have been adversely affected by a credit downgrade or failure of the AIG parent.'
She said that some of AIG's competitors claim that AIG's commercial insurance pricing is out of line with its risks but other insurance industry participants and observers disagree."
For Source and Full Article Visit: Insurance Journal
FSA head calls for regulation of rating agencies
FSA head calls for regulation of rating agencies: "Credit rating agencies should be regulated, the chairman of the U.K.'s financial services regulator said in a wide-ranging report on the regulation of the global banking sector.
In the Wednesday report, Lord Adair Turner, chairman of the London-based Financial Services Authority, said the regulator supports European Commission efforts to bring in regulation for rating agencies. In the report, 'The Turner Review: A regulatory response to the global banking crisis,' Lord Turner said the growth of the credit derivatives market, for example, created the possibility that the use of credit ratings in counterparty collateral arrangements would produce a 'strong procyclical effect.' For example, he said, the threatened rating agency downgrade of American International Group Inc. in September 2008 'led to severe liquidity strain.'
Among other things, Lord Turner said 'there are concerns about whether the governance of rating agencies has adequately addressed issues relating to conflict of interest and analytical independence.'"
For Source and Full Article Visit: Business Insurance
In the Wednesday report, Lord Adair Turner, chairman of the London-based Financial Services Authority, said the regulator supports European Commission efforts to bring in regulation for rating agencies. In the report, 'The Turner Review: A regulatory response to the global banking crisis,' Lord Turner said the growth of the credit derivatives market, for example, created the possibility that the use of credit ratings in counterparty collateral arrangements would produce a 'strong procyclical effect.' For example, he said, the threatened rating agency downgrade of American International Group Inc. in September 2008 'led to severe liquidity strain.'
Among other things, Lord Turner said 'there are concerns about whether the governance of rating agencies has adequately addressed issues relating to conflict of interest and analytical independence.'"
For Source and Full Article Visit: Business Insurance
African Insurance Brokers Assoc to establish reinsurer
African Insurance Brokers Assoc to establish reinsurer: "THE African Insurance Brokers Association (AIBA) is to establish a reinsurance firm with �5 million start-up capital.
Mr. Jonnie Wilcox, Managing Director of United African Insurance Brokers (UAIB), disclosed this in Lagos yesterday at the 2009 AIBA International Seminar organised by the African Insurance Organisation (AIO) in conjunction with the AIBA.
He disclosed that the reinsurance firm would open for business in January 2010 and its headquarters would be located in London, which he described as the home of insurance business worldwide.
He said that each broker would be required to buy a minimum of one unit of the company's shares and a maximum of four units.
'One unit of share in the reinsurance company will cost about N6.25 million at an exchange rate of N250 to �1.
The scheme tagged 'The Reinsurance Brokers Project' was planned since 1993 and would have started operation in 1994 but due to circumstances beyond our control.
'Now that it is being brought up again, January 2010 will not elude us,' he said.
Wilcox said that the firm had been planned in such a way that it would become a vehicle to generate large volume of businesses into the African economy.
He said that it would also bridge the gap between African countries and Europe by bringing technical expertise as well as reinsurance businesses to African circle.
Chief John Akin-George, Chairman of AIBA, said that the brokers could not wait any more for the company to come on board.
He pointed out that if it had been floated 10 years ago, brokers would have been enjoying its benefits as well as dividends.
'With only one unit a broker or anybody that has invested in it will sit at home, take coffee, smoke his cigar and wait for his dividend,' he said.
Ms Prisca Soares, Secretary General of AIO, advised that brokers should have a report of the company ready to present to the AIO General Assembly and yearly general meeting coming up in Tanzania later this year."
For Source and Full Article Visit: Guardian Newspapers
Mr. Jonnie Wilcox, Managing Director of United African Insurance Brokers (UAIB), disclosed this in Lagos yesterday at the 2009 AIBA International Seminar organised by the African Insurance Organisation (AIO) in conjunction with the AIBA.
He disclosed that the reinsurance firm would open for business in January 2010 and its headquarters would be located in London, which he described as the home of insurance business worldwide.
He said that each broker would be required to buy a minimum of one unit of the company's shares and a maximum of four units.
'One unit of share in the reinsurance company will cost about N6.25 million at an exchange rate of N250 to �1.
The scheme tagged 'The Reinsurance Brokers Project' was planned since 1993 and would have started operation in 1994 but due to circumstances beyond our control.
'Now that it is being brought up again, January 2010 will not elude us,' he said.
Wilcox said that the firm had been planned in such a way that it would become a vehicle to generate large volume of businesses into the African economy.
He said that it would also bridge the gap between African countries and Europe by bringing technical expertise as well as reinsurance businesses to African circle.
Chief John Akin-George, Chairman of AIBA, said that the brokers could not wait any more for the company to come on board.
He pointed out that if it had been floated 10 years ago, brokers would have been enjoying its benefits as well as dividends.
'With only one unit a broker or anybody that has invested in it will sit at home, take coffee, smoke his cigar and wait for his dividend,' he said.
Ms Prisca Soares, Secretary General of AIO, advised that brokers should have a report of the company ready to present to the AIO General Assembly and yearly general meeting coming up in Tanzania later this year."
For Source and Full Article Visit: Guardian Newspapers
WR Berkley CEO: Offshore Insurance Tax Advantage's Days Appear Limited
BER Berkley CEO: Offshore Insurance Tax Advantage's Days Appear Limited: "American insurers looking to curtail a tax advantage they say favors competitors who set up reinsurance operations in Bermuda have taken heart that the Obama administration's proposed budget includes language favorable to their cause. But little will happen until legislation enabling that becomes reality.
Speaking at A.M. Best's Review/Preview ratings conference, W.R. Berkley Corp. Chairman and Chief Executive Officer William R. Berkley said he was heartened by news that projections in the President's budget anticipate increased tax revenues from offshore financial transactions, some of which will likely include insurance activities.
At present, there is no formal legislation in either branch of Congress that changes the treatment of related party reinsurance transactions with offshore affiliates with regard to risk underwritten in the United States.
In 2008, U.S. Rep. Richard Neal, D-Mass. introduced H.R. 6969, to address concerns raised by the 14-member Coalition for a Domestic Insurance Industry. That group includes U.S.-based property/casualty insurers such as W.R. Berkley Corp., Berkshire Hathaway, Chubb Corp., Hartford Financial Services Group, Liberty Mutual, Safeco Corp. and Travelers Cos. The group contends that shifting profits on business written in the United States to jurisdictions with favorable tax treatment such as Bermuda and the Cayman Islands have made it increasingly difficult for U.S.-domiciled firms to compete. That legislation expired.
Neal's original bill called for limiting deductions for related-party reinsurance cessions to the average percentage of premium ceded to unrelated reinsurers. Excess amounts would be determined by line of business, and the U.S. Treasury would be authorized to enforce its provisions."
For Source and Full Article Visit: Trading Markets
Speaking at A.M. Best's Review/Preview ratings conference, W.R. Berkley Corp. Chairman and Chief Executive Officer William R. Berkley said he was heartened by news that projections in the President's budget anticipate increased tax revenues from offshore financial transactions, some of which will likely include insurance activities.
At present, there is no formal legislation in either branch of Congress that changes the treatment of related party reinsurance transactions with offshore affiliates with regard to risk underwritten in the United States.
In 2008, U.S. Rep. Richard Neal, D-Mass. introduced H.R. 6969, to address concerns raised by the 14-member Coalition for a Domestic Insurance Industry. That group includes U.S.-based property/casualty insurers such as W.R. Berkley Corp., Berkshire Hathaway, Chubb Corp., Hartford Financial Services Group, Liberty Mutual, Safeco Corp. and Travelers Cos. The group contends that shifting profits on business written in the United States to jurisdictions with favorable tax treatment such as Bermuda and the Cayman Islands have made it increasingly difficult for U.S.-domiciled firms to compete. That legislation expired.
Neal's original bill called for limiting deductions for related-party reinsurance cessions to the average percentage of premium ceded to unrelated reinsurers. Excess amounts would be determined by line of business, and the U.S. Treasury would be authorized to enforce its provisions."
For Source and Full Article Visit: Trading Markets
Investor Wilbur Ross eyeing insurance investments
Investor Wilbur Ross eyeing insurance investments : "Billionaire investor Wilbur Ross said on Thursday he is keen to invest more in insurance, a sector he has been active in for more than a decade, but is biding his time until pricing fundamentals improve.
Mr. Ross, on the sidelines of an insurance conference in New York, told Reuters he is especially interested in the reinsurance sector but would like to see improvement in the rates carriers charge for coverage.
Insurance pricing tends to rise after an event that leads to large claims on the industry's capital and to decline when underwriting losses are minimal. Currently, rates are expected to increase, with the industry having been hit in 2008 by large hurricane losses and poor investment performance.
Mr. Ross said he would like to see the industry's big pricing swings tamed. 'There has to be more stability in the rates,' he said.
The veteran turnaround specialist first invested in insurance—a Korean life insurer—in 1998 and later made numerous investments in property/catastrophe reinsurers, including Montpelier Re, a Bermuda-based firm.
More recently, he has built a stake in Assured Guaranty, a bond insurer that has seen its stock price hammered amid the credit crunch despite strong underwriting results.
Mr. Ross, the founder of New York-based private equity firm WL Ross & Co. L.L.C., said U.S. municipal bond buyers are now doing the bulk of their business with Assured. The firm has captured 80% market share, he said.
A newer bond insurer formed in late 2007 by Warren Buffett's Berkshire Hathaway Inc. is the other company most active in the market.
Assured has largely escaped the credit problems that crippled rivals Ambac and MBIA by avoiding insuring repackaged subprime mortgages. It is expected to soon seal its acquisition of Belgian lender Dexia's U.S. bond insurance unit, Financial Security Assurance."
For Source and Full Article Visit: Business Insurance
Mr. Ross, on the sidelines of an insurance conference in New York, told Reuters he is especially interested in the reinsurance sector but would like to see improvement in the rates carriers charge for coverage.
Insurance pricing tends to rise after an event that leads to large claims on the industry's capital and to decline when underwriting losses are minimal. Currently, rates are expected to increase, with the industry having been hit in 2008 by large hurricane losses and poor investment performance.
Mr. Ross said he would like to see the industry's big pricing swings tamed. 'There has to be more stability in the rates,' he said.
The veteran turnaround specialist first invested in insurance—a Korean life insurer—in 1998 and later made numerous investments in property/catastrophe reinsurers, including Montpelier Re, a Bermuda-based firm.
More recently, he has built a stake in Assured Guaranty, a bond insurer that has seen its stock price hammered amid the credit crunch despite strong underwriting results.
Mr. Ross, the founder of New York-based private equity firm WL Ross & Co. L.L.C., said U.S. municipal bond buyers are now doing the bulk of their business with Assured. The firm has captured 80% market share, he said.
A newer bond insurer formed in late 2007 by Warren Buffett's Berkshire Hathaway Inc. is the other company most active in the market.
Assured has largely escaped the credit problems that crippled rivals Ambac and MBIA by avoiding insuring repackaged subprime mortgages. It is expected to soon seal its acquisition of Belgian lender Dexia's U.S. bond insurance unit, Financial Security Assurance."
For Source and Full Article Visit: Business Insurance
Where next for the merger market?
Where next for the merger market?: "Several UK and European insurance businesses could be sold as part of the sector restructuring as banks try to find ways of raising capital says Pricewaterhouse Coopers. “Throughout 2009, there will be scope for in-market and cross border consolidation, and banks divesting insurance subsidiaries will provide further stimulus for M&A in the European insurance market,” said Charles Garnsworthy, partner at PwC. “UK banks will probably be active in making divestments in 2009 as they seek to shore up their capital positions.”
Market consolidation could also be driven by falling profitability in the general insurance market, capital pressure on life companies, and capital requirements under Solvency II. But there will be winners out of this, points out Garnsworthy: “There may be opportunities for aggregators and external capital sources, such as PE Houses, to selectively acquire distressed portfolios at discounted prices.”
The report by PwC revealed that deal dynamics have changed dramatically since 2008. Deals are now dominated by haste, opportunism, and government involvement, and are no longer driven by the desire to expand businesses or reaching into new markets.
For Source and Full Article Visit: Insurance Times
Market consolidation could also be driven by falling profitability in the general insurance market, capital pressure on life companies, and capital requirements under Solvency II. But there will be winners out of this, points out Garnsworthy: “There may be opportunities for aggregators and external capital sources, such as PE Houses, to selectively acquire distressed portfolios at discounted prices.”
The report by PwC revealed that deal dynamics have changed dramatically since 2008. Deals are now dominated by haste, opportunism, and government involvement, and are no longer driven by the desire to expand businesses or reaching into new markets.
For Source and Full Article Visit: Insurance Times
Qatar aims to become insurance hub
Qatar aims to become insurance hub: "Qatar Financial Centre Authority (QFCA) has set its sights high with the goal of making Qatar a regional hub for insurance and reinsurance activity.
The group’s director-general, Stuart Pearce, said the country must develop strategic initiatives from locally-based assets if the goal is to be achieved.
“Following the 500 meetings that QFCA official had held with leading insurance firms across the world, the level of interest about the region and especially Qatar is growing, thanks to the country’s sound economic performance and strategic economic initiatives initiated by the government,” Pearce said.
Government support is indeed forthcoming, with Qatar’s finance minister, Yousef Hussein Kamal, giving his personal backing to the QFCA’s vision.
Speaking at the MultaQa Qatar conference this weekend, Kamal said: “In our region, non-life premiums, on average, account for just one percent of GDP.
“This compares with 3% for the UK and 5% for the US.
“I am convinced that we will successfully narrow this gap as our economic diversification strategy progresses and public awareness of insurance improves.”
He added that insurance activity in the Gulf Cooperation Council (GCC) accounts for less than 1% of the world’s total.
“The potential for growth is enormous,” Kamal said.
He added that Qatar’s efforts to reinforce its economy include the creation of Qatar Insurance Services (QIS) and Qatar Finance and Business Academy (QFBA)."
For Source and Full Article Visit: Insurance Daily
The group’s director-general, Stuart Pearce, said the country must develop strategic initiatives from locally-based assets if the goal is to be achieved.
“Following the 500 meetings that QFCA official had held with leading insurance firms across the world, the level of interest about the region and especially Qatar is growing, thanks to the country’s sound economic performance and strategic economic initiatives initiated by the government,” Pearce said.
Government support is indeed forthcoming, with Qatar’s finance minister, Yousef Hussein Kamal, giving his personal backing to the QFCA’s vision.
Speaking at the MultaQa Qatar conference this weekend, Kamal said: “In our region, non-life premiums, on average, account for just one percent of GDP.
“This compares with 3% for the UK and 5% for the US.
“I am convinced that we will successfully narrow this gap as our economic diversification strategy progresses and public awareness of insurance improves.”
He added that insurance activity in the Gulf Cooperation Council (GCC) accounts for less than 1% of the world’s total.
“The potential for growth is enormous,” Kamal said.
He added that Qatar’s efforts to reinforce its economy include the creation of Qatar Insurance Services (QIS) and Qatar Finance and Business Academy (QFBA)."
For Source and Full Article Visit: Insurance Daily
AIG weighing sale of Manhattan headquarters
AIG weighing sale of Manhattan headquarters: "American International Group Inc (AIG.N), being kept afloat by a $180 billion government bailout, may sell its downtown Manhattan headquarters.
'AIG is evaluating the potential sale of its headquarters building at 70 Pine Street and the 72 Wall Street building,' said spokesman Mark Herr in a statement. 'This is part of AIG's divestiture strategy and effort to maximize operating efficiency.'
AIG has been the focus of an irate U.S. Congress this week, fuming over $165 million in bonus payments to executives after the massive bailout.
Both buildings were constructed in 1932 and have been owned and operated by AIG since the 1970s. The insurer's roots date back to China in 1919.
The 66-story 70 Pine Street building is topped with a Gothic-like spire, and was the tallest building in downtown Manhattan prior to the building of the World Trade Center.
Herr said 'market interest' would help AIG decide the best way to proceed with the sale.
He declined to say what price tag AIG was seeking for the properties. CB Richard Ellis (CBG.N) is representing AIG.
It has also put the prized building in the Otemachi section of Tokyo that overlooks the Imperial Palace up for sale and is in talks to sell other real estate assets around the world."
For Source and Full Article Visit: Reuters
'AIG is evaluating the potential sale of its headquarters building at 70 Pine Street and the 72 Wall Street building,' said spokesman Mark Herr in a statement. 'This is part of AIG's divestiture strategy and effort to maximize operating efficiency.'
AIG has been the focus of an irate U.S. Congress this week, fuming over $165 million in bonus payments to executives after the massive bailout.
Both buildings were constructed in 1932 and have been owned and operated by AIG since the 1970s. The insurer's roots date back to China in 1919.
The 66-story 70 Pine Street building is topped with a Gothic-like spire, and was the tallest building in downtown Manhattan prior to the building of the World Trade Center.
Herr said 'market interest' would help AIG decide the best way to proceed with the sale.
He declined to say what price tag AIG was seeking for the properties. CB Richard Ellis (CBG.N) is representing AIG.
It has also put the prized building in the Otemachi section of Tokyo that overlooks the Imperial Palace up for sale and is in talks to sell other real estate assets around the world."
For Source and Full Article Visit: Reuters
S&P has a gloomy outlook for Chinese insurer
S&P has a gloomy outlook for Chinese insurer: "US ratings agency Standard & Poor's Ratings Services has placed its 'BBB-' long-term and 'A-3' short-term counterparty credit ratings on China Insurance International Holdings Co. Ltd. (CIIH) and the 'BBB-' issue rating on the company's senior unsecured debt on CreditWatch with negative implications.
At the same time, Standard & Poor's also placed its 'A-' long-term counterparty credit and insurer financial strength ratings on China International Reinsurance Co. Ltd. (CIRe) on CreditWatch with negative implications.
'The CreditWatch actions follow the group's recent profit announcement and reflect the risks stemming from the deterioration in the group's capitalization as a result of losses made in 2008,' S&P said. It added that 'there is some uncertainty about the group's likely earnings performance over the next two years, given the currently volatile market conditions and the rapid growth of the group's operations in China.'
S&P said that CIIH's operating performance in fiscal 2008 was weaker than expected despite its profit warning a month ago. The insurer reported a loss attributable to shareholders of Hong Kong dollar (HK$) 299.715m."
For Source and Full Article Visit: Reinsurance Magazine
At the same time, Standard & Poor's also placed its 'A-' long-term counterparty credit and insurer financial strength ratings on China International Reinsurance Co. Ltd. (CIRe) on CreditWatch with negative implications.
'The CreditWatch actions follow the group's recent profit announcement and reflect the risks stemming from the deterioration in the group's capitalization as a result of losses made in 2008,' S&P said. It added that 'there is some uncertainty about the group's likely earnings performance over the next two years, given the currently volatile market conditions and the rapid growth of the group's operations in China.'
S&P said that CIIH's operating performance in fiscal 2008 was weaker than expected despite its profit warning a month ago. The insurer reported a loss attributable to shareholders of Hong Kong dollar (HK$) 299.715m."
For Source and Full Article Visit: Reinsurance Magazine
A Milder Hurricane Outlook From AccuWeather
A Milder Hurricane Outlook From AccuWeather: "The 2009 hurricane season will see three hurricanes impacting the U.S. coast, compared with four that arrived last year, and a lower total number of named storms, according to an AccuWeather.com early forecast.
Joe Bastardi, AccuWeather chief long-range and hurricane forecaster, also predicted storms may be more likely to form in the Atlantic basin closer to the coast. The possibility of a major hurricane making a U.S. landfall cannot be ruled out, he warned.
“This year’s forecast shows only half as many impacts on the United States as there were last year,” Mr. Bastardi said. “But keep in mind, it only takes one major hurricane hitting a highly populated area to have devastating impact.”
“Early indications show a reduction in the overall number of named storms and of major hurricanes in the Atlantic basin compared to last year, but the number of storms should still be near or a little above normal.”"
For Source and Full Article Visit: National Underwriter
Joe Bastardi, AccuWeather chief long-range and hurricane forecaster, also predicted storms may be more likely to form in the Atlantic basin closer to the coast. The possibility of a major hurricane making a U.S. landfall cannot be ruled out, he warned.
“This year’s forecast shows only half as many impacts on the United States as there were last year,” Mr. Bastardi said. “But keep in mind, it only takes one major hurricane hitting a highly populated area to have devastating impact.”
“Early indications show a reduction in the overall number of named storms and of major hurricanes in the Atlantic basin compared to last year, but the number of storms should still be near or a little above normal.”"
For Source and Full Article Visit: National Underwriter
Prudential CEO to step down, company not bidding for AIG
Prudential shares soar after insurer beats forecast, ups dividend: "Shares in U.K. insurance giant Prudential Plc soared over 20% Thursday after the group reported better-than-expected results, lifted its dividend and said it won't bid for a division of American International Group.
PUK 8.13, +0.50, +6.5%) said it swung to a 396 million pound ($562 million) overall net loss in 2008 from a profit of 947 million pounds a year earlier, due to a loss on investments of 1.78 billion pounds, mainly from its U.S. operations.
However, the group said that operating profit using European embedded value accounting standards (EEV) rose 17% to 2.96 billion pounds, beating the consensus forecast of 2.56 billion pounds. Operating profit doesn't include any short-term investment losses.
It also announced the departure of CEO Mark Tucker, who will step down at the end of September after four-and-a-half years in the role. He will be succeeded by Chief Financial Officer Tidjane Thiam.
'Prudential is likely to be one of only a few insurers that can afford to raise its dividend as it has strong cashflow and a strong capital base,' said Societe Generale analyst Michael van Wegen, who added that Thiam has made 'a good impression' since joining the firm in April last year.
Shares in Prudential, which is not affiliated with the U.S. company of the same name, jumped 22% in London following the announcements. See London Markets for more.
The gains were also part of a broader rally for the insurers -- which are significant holders of corporate bonds -- following the Federal Reserve's plan to buy up to $300 billion of long-term Treasurys, which sent bond prices soaring.
Prudential said operating profit growth was strongest in Asia -- its largest market -- and the U.K., while earnings shrank in the U.S.
The company reportedly may replace American International Group as the sponsor of Manchester United Football Club, which has a strong fan-base in Asia.
However, CEO Tucker confirmed on a conference call with analysts that Prudential will not be bidding for AIA, the Asian arm of AIG, saying the potential terms simply didn't make financial sense for the group. Ruling out an AIA bid removes one of the worries that Prudential could overpay for the business and end up having to launch a massive rights issue, said Keefe, Bruyette & Woods analyst Greig Paterson."
For Source and Full Article Visit: MarketWatch
PUK 8.13, +0.50, +6.5%) said it swung to a 396 million pound ($562 million) overall net loss in 2008 from a profit of 947 million pounds a year earlier, due to a loss on investments of 1.78 billion pounds, mainly from its U.S. operations.
However, the group said that operating profit using European embedded value accounting standards (EEV) rose 17% to 2.96 billion pounds, beating the consensus forecast of 2.56 billion pounds. Operating profit doesn't include any short-term investment losses.
It also announced the departure of CEO Mark Tucker, who will step down at the end of September after four-and-a-half years in the role. He will be succeeded by Chief Financial Officer Tidjane Thiam.
'Prudential is likely to be one of only a few insurers that can afford to raise its dividend as it has strong cashflow and a strong capital base,' said Societe Generale analyst Michael van Wegen, who added that Thiam has made 'a good impression' since joining the firm in April last year.
Shares in Prudential, which is not affiliated with the U.S. company of the same name, jumped 22% in London following the announcements. See London Markets for more.
The gains were also part of a broader rally for the insurers -- which are significant holders of corporate bonds -- following the Federal Reserve's plan to buy up to $300 billion of long-term Treasurys, which sent bond prices soaring.
Prudential said operating profit growth was strongest in Asia -- its largest market -- and the U.K., while earnings shrank in the U.S.
The company reportedly may replace American International Group as the sponsor of Manchester United Football Club, which has a strong fan-base in Asia.
However, CEO Tucker confirmed on a conference call with analysts that Prudential will not be bidding for AIA, the Asian arm of AIG, saying the potential terms simply didn't make financial sense for the group. Ruling out an AIA bid removes one of the worries that Prudential could overpay for the business and end up having to launch a massive rights issue, said Keefe, Bruyette & Woods analyst Greig Paterson."
For Source and Full Article Visit: MarketWatch
Willis Research Network wins Google Research Award
Willis Research Network wins Google ResearchAward: "Willis Research Fellow Dr Aidan Slingsby and Dr Jason Dykes and Dr Jo Wood of City University London, in collaboration with Willis Research Network (WRN) Senior Academic Dr David Stephenson and Rachel Lowe of Exeter University, have won a Google research prize for their work on visualising seasonal climate forecasts in Google Earth. The entry allowed 10 years of seasonal climate forecast data in South America to be explored.
The judges agreed that it 'represented a novel and compelling representation of science using Google Earth and the KML language'. Willis aims to lead modern mapping and GeoVisualisation techniques across insurance."
For Source and Full Article Visit: Willis Research Network
The judges agreed that it 'represented a novel and compelling representation of science using Google Earth and the KML language'. Willis aims to lead modern mapping and GeoVisualisation techniques across insurance."
For Source and Full Article Visit: Willis Research Network
Swiss Re extends IT services contract - vnunet.com
Swiss Re extends IT services contract: "Swiss Re has extended a business process outsourcing deal with Perot Systems for a further 10 years.
The renewal will see Perot continuing to provide administrative and business process services, including IT support for new acquisitions, as well as customer service and transaction processing through the supplier’s service policy administration platform.
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Business process services provided by the outsourcer also include product engineering, claim application processing, life insurance policy administration, running of call centres, payment and settlement and services to improve the collection of receivables."
For Source and Full Article Visit: vnunet.com
The renewal will see Perot continuing to provide administrative and business process services, including IT support for new acquisitions, as well as customer service and transaction processing through the supplier’s service policy administration platform.
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Business process services provided by the outsourcer also include product engineering, claim application processing, life insurance policy administration, running of call centres, payment and settlement and services to improve the collection of receivables."
For Source and Full Article Visit: vnunet.com
America Hates AIG, So the Company’s Stock Triples
America Hates AIG, So the Company’s Stock Triples: "We’re well into the Great American Outrage-fest over AIG. It’s been a week since President Barack Obama learned of the bonuses, according to the White House. We’ve had finger-pointing between Congress and the Treasury, even though people in each knew about the bonuses because — surprise! — they’ve been reported in the Journal and elsewhere for months. America is angry. They hate AIG. Its once-great name will have to go.
The result of this outpouring? AIG shares have more than tripled.
Last Friday, AIG stock sat at 50 cents a share. The shares closed Wednesday at $1.38, despite the weekend of outrage and a three-day beating that forever branded the world’s largest insurer into America’s most unforgettable corporate villain. This morning the stock jumped 44% out of the gates to $1.99, though it has since pulled back.
Of course, the stock is far from the $50 a share it was trading at a year ago. It’s well off the $3.75 closing price a few hours before the September bailout, and still shy of the $2.04 closing a day after the bailout.
But that’s more than a 200% return in three days. Some of it may have been short-covering, with investors realizing the stock’s low point (33 cents) was enough. Maybe the fact that the Federal Reserve and the Obama administration were standing behind AIG — and the successful resolution of AIG Financial Products — gave investors hope. Maybe it’s the start of something that will return taxpayers some value eventually. (The government owns about 80% of the equity in AIG.)
It’s hard to say. It just tells you that a widespread loss of America’s confidence does not always translate into a loss in equity value."
For Source and Full Article Visit: WSJ
The result of this outpouring? AIG shares have more than tripled.
Last Friday, AIG stock sat at 50 cents a share. The shares closed Wednesday at $1.38, despite the weekend of outrage and a three-day beating that forever branded the world’s largest insurer into America’s most unforgettable corporate villain. This morning the stock jumped 44% out of the gates to $1.99, though it has since pulled back.
Of course, the stock is far from the $50 a share it was trading at a year ago. It’s well off the $3.75 closing price a few hours before the September bailout, and still shy of the $2.04 closing a day after the bailout.
But that’s more than a 200% return in three days. Some of it may have been short-covering, with investors realizing the stock’s low point (33 cents) was enough. Maybe the fact that the Federal Reserve and the Obama administration were standing behind AIG — and the successful resolution of AIG Financial Products — gave investors hope. Maybe it’s the start of something that will return taxpayers some value eventually. (The government owns about 80% of the equity in AIG.)
It’s hard to say. It just tells you that a widespread loss of America’s confidence does not always translate into a loss in equity value."
For Source and Full Article Visit: WSJ
Outing AIG's Bonus Babies: What's the Point?
Outing AIG's Bonus Babies: What's the Point?: "Is there a point in divulging the names of the AIG (AIG) executives who received bonuses? There seems to be a frenzy on the part of some blogs and the MSM to identify the recipients and even publish their pictures.
Given that credible threats have been made towards AIG and those that received bonuses, publishing information that could lead some lunatic to them seems awfully irresponsible. Whatever possible good may be accomplished (I can think of none), the potential for causing great harm would seem to argue strongly in favor of some reticence.
One could argue simply that those who received bonuses are deserving of the same right to privacy as any of us. I know that argument will be attacked with lots of pious counters about receiving government money, our right to know as shareholders etc. So be it. Let me throw something else out there.
How about granting a presumption of innocence to some of these guys. Do you know who took the money and contributed nothing in return? Of course you don’t, and neither do any of the high-minded accusers. Quite probably there are some pretty smart guys in AGIFP who could have checked out at the first sign of trouble and walked across the street to a job that would have paid them as much or more than they made by sticking around. It’s also pretty likely that some of them saved us more than a little bit of money just because they knew where the bodies were buried and how to unwind part of the mess at the least cost.
Damning all of them without knowing all of the facts is unfair. Putting their welfare and that of their families in jeopardy is not something I want to be responsible for.
Barring any more lunacy, I suspect that this will be the last I write about this issue. It’s a media-inspired tempest that means little in the larger scheme. Thankfully, the Fed came along yesterday and pretty much sucked the air out of it."
For Source and Full Article Visit: Seeking Alpha
Given that credible threats have been made towards AIG and those that received bonuses, publishing information that could lead some lunatic to them seems awfully irresponsible. Whatever possible good may be accomplished (I can think of none), the potential for causing great harm would seem to argue strongly in favor of some reticence.
One could argue simply that those who received bonuses are deserving of the same right to privacy as any of us. I know that argument will be attacked with lots of pious counters about receiving government money, our right to know as shareholders etc. So be it. Let me throw something else out there.
How about granting a presumption of innocence to some of these guys. Do you know who took the money and contributed nothing in return? Of course you don’t, and neither do any of the high-minded accusers. Quite probably there are some pretty smart guys in AGIFP who could have checked out at the first sign of trouble and walked across the street to a job that would have paid them as much or more than they made by sticking around. It’s also pretty likely that some of them saved us more than a little bit of money just because they knew where the bodies were buried and how to unwind part of the mess at the least cost.
Damning all of them without knowing all of the facts is unfair. Putting their welfare and that of their families in jeopardy is not something I want to be responsible for.
Barring any more lunacy, I suspect that this will be the last I write about this issue. It’s a media-inspired tempest that means little in the larger scheme. Thankfully, the Fed came along yesterday and pretty much sucked the air out of it."
For Source and Full Article Visit: Seeking Alpha
Midwest's New Madrid Earthquake Zone: Is It Dying Out?
Midwest's New Madrid Earthquake Zone: Is It Dying Out?: "A Midwest fault zone that unleashed a series of violent earthquakes in the early 19th century shows no signs of building up the stresses needed for the quakes many seismologists expect to someday rock the region again, two scientists say.
The researchers said that may mean the little-understood New Madrid Seismic Zone is shutting down or that seismic activity is shifting to adjacent faults in the nation's midsection.
Other scientists called those conclusions premature, in part because the study was based on a relatively narrow time period from the area that remains seismically active.
For their study, researchers from Purdue and Northwestern universities analyzed global positioning measurements of shifts in the Earth's surface taken from 10 sites within the New Madrid zone over eight years. That region in the central Mississippi Valley produced a series of earthquakes in 1811 and 1812 of an estimated magnitude 7.0 or greater.
Researchers expected to find surface features moving at least one to 2 millimeters each year. Such shifts would reflect growing subterranean stresses like the slow stretching of a rubber band that seismologists expect to someday spark more big New Madrid quakes.
Instead, they found annual shifts of 0.2 millimeter or less each year -- an amount so tiny it essentially represents no growing stresses in the seismic zone, said Eric Calais, a Purdue professor of earth and atmospheric sciences who led the study."
For Source and Full Article Visit: Insurance Journal
The researchers said that may mean the little-understood New Madrid Seismic Zone is shutting down or that seismic activity is shifting to adjacent faults in the nation's midsection.
Other scientists called those conclusions premature, in part because the study was based on a relatively narrow time period from the area that remains seismically active.
For their study, researchers from Purdue and Northwestern universities analyzed global positioning measurements of shifts in the Earth's surface taken from 10 sites within the New Madrid zone over eight years. That region in the central Mississippi Valley produced a series of earthquakes in 1811 and 1812 of an estimated magnitude 7.0 or greater.
Researchers expected to find surface features moving at least one to 2 millimeters each year. Such shifts would reflect growing subterranean stresses like the slow stretching of a rubber band that seismologists expect to someday spark more big New Madrid quakes.
Instead, they found annual shifts of 0.2 millimeter or less each year -- an amount so tiny it essentially represents no growing stresses in the seismic zone, said Eric Calais, a Purdue professor of earth and atmospheric sciences who led the study."
For Source and Full Article Visit: Insurance Journal
AIG could face court action on bonus details: Cuomo
AIG could face court action on bonus details: Cuomo: "American International Group Inc. will be taken to court if it does not provide details Thursday of bonus recipients that were requested under a subpoena, New York Attorney General Andrew Cuomo said.
Mr. Cuomo also told reporters on a conference call that he expected Bank of America to provide the names of 200 highest bonus earners at Merrill Lynch & Co. last year under a state court ruling published Wednesday, which said the names were not a trade secret and could be made public."
For Source and Full Article Visit: Business Insurance
Mr. Cuomo also told reporters on a conference call that he expected Bank of America to provide the names of 200 highest bonus earners at Merrill Lynch & Co. last year under a state court ruling published Wednesday, which said the names were not a trade secret and could be made public."
For Source and Full Article Visit: Business Insurance
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