Munich Re reinsurer says profits up in Q2

German reinsurance giant Munich Re said on Thursday that its profits were up strongly in the second quarter and the company was on track to meet its full-year targets. Munich Re said in a statement that it’s net profit jumped by 44.9 per cent to 765 million euros ($1.0 billion) in the period from April to June. Underlying or operating profit soared by 62.2 per cent to 1.145 billion euros, while gross premium income declined by 7.4 per cent to 11.856 billion euros. Chief executive Nikolaus von Bomhard said he was ‘satisfied with the result’ and ‘despite the difficult business environment ... was optimistic about achieving the profit target of 3.0 billion euros for the year.’ In terms of gross premium income, Munich Re is penciling in a full-year total of 48 billion euros, the statement said. ‘Munich Re expects a continuation of the low interest-rate levels in 2014 and hence somewhat lower regular income from fixed-interest investments,’ it said. Reinsurance companies specialise in taking on part of the risks underwritten by mainstream insurance groups, thereby spreading risk, according to AFP.