Annual Report 1997/1998 - Munich Re

Munich Re
Dr. Hans-Jürgen Schinzler,
Chairman of the Board of
Management, during the
1997 AGM
Dear Shareholders,
Growth of 38% in premium income and an increase of 64% in the
profit for the year – these figures show the success of the Munich Re
Group in the business year 1997/98. The improved operating position
is reflected in the earnings per share, which have risen to DM 19.42.
The pleasing development in the result will enable us to increase the
dividend from DM 1.70 to DM 1.80.
The Group’s success is also reflected in the performance of Munich
Re’s registered shares: the share price has risen by almost 120% since
the beginning of 1997. The Munich Re warrants whose exercise period
expired in March 1998 also performed outstandingly well, yielding a
return of around 500% over the four years.
The business environment for reinsurance has changed markedly in
recent years. We have therefore changed Munich Re as well: it has
become the Munich Re Group, in which premium income derives
almost equally from direct insurance and reinsurance.
Munich Re’s core business is and will remain reinsurance.
In many countries and classes of insurance we are market leaders –
in some cases we have been for decades. We intend to maintain and
improve on this outstanding position. In pursuing this objective, we are
having to deal with increasingly large competitors. In the medium to
long term only those players can be successful as reinsurers that
provide services and products which clients really need, which create
added value for them. We have therefore been pressing ahead with the
development of new products and services that take account of clients’
changing requirements. This applies both to the growing demand for
comprehensive financial concepts, e.g. financial reinsurance for
insurers, and to the demand for innovative coverage concepts in the
so-called alternative markets; it also applies to those business sectors
such as life and health insurance where private insurance solutions
can supplement or replace state social insurance.
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