Quarterly Report • Aug 6, 2007
Quarterly Report
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| Figures in EUR million | 2007 | 2006 | ||||||
|---|---|---|---|---|---|---|---|---|
| 1.1.–31.3. | 1.4.–30.6. | +/- previous year |
1.1.–30.6. | +/- previous year |
1.4.–30.6. | 1.1.–30.6. | 31.12. | |
| Results | ||||||||
| Gross written premium | 2,408.4 | 2,083.1 | -11.5% | 4,491.6 | -10.4% | 2,354.7 | 5,012.6 | |
| Net premium earned | 1,736.8 | 1,968.4 | +6.8% | 3,705.2 | +1.9% | 1,842.3 | 3,636.7 | |
| Net underwriting result | (88.6) | (3.5) | -90.5% | (92.1) | +40.8% | (36.4) | (65.4) | |
| Net investment income | 255.1 | 324.9 | +33.2% | 579.9 | +19.8% | 244.0 | 483.9 | |
| Operating profit/loss (EBIT) | 154.2 | 313.5 | +44.1% | 467.7 | +15.8% | 217.6 | 403.9 | |
| Group net income | 123.5 | 169.4 | +12.3% | 293.0 | +14.2% | 150.8 | 256.6 | |
| Balance sheet | ||||||||
| Policyholders' surplus | 5,020.9 | 4,824.1 | -1.1% | 4,878.4 | ||||
| Total shareholders' equity | 3,052.4 | 2,976.4 | +2.7% | 2,897.8 | ||||
| Minority interests | 595.8 | 474.7 | -22.0% | 608.6 | ||||
| Hybrid capital | 1,372.7 | 1,373.0 | +0.1% | 1,372.0 | ||||
| Investments (incl. funds held by ceding companies) |
28,688.4 | 29,190.6 | +2.3% | 28,538.1 | ||||
| Total assets | 42,146.5 | 39,154.8 | -5.4% | 41,386.4 | ||||
| Share | ||||||||
| Earnings per share (diluted) in EUR | 1.02 | 1.41 | 2.43 | 1.25 | 2.13 | |||
| Book value per share in EUR | 25.31 | 24.68 | +2.7% | 21.23 | 24.03 | |||
| Share price at year-end in EUR | 33.35 | 35.95 | +31.4% | 35.95 | +2.5% | 27.35 | 27.35 | 35.08 |
| Dividend | – | – | – | – | – | 193.00 | ||
| Dividend per share in EUR | – | – | – | – | – | 1.60 | ||
| Market capitalisation | 4,021.90 | 4,335.5 | +2.5% | 3,298.3 | 4,230.5 | |||
| Ratios | ||||||||
| Combined ratio (non-life reinsurance) 1) | 105.2% | 98.9% | 101.9% | 100.3% | 99.4% | |||
| Catastrophe/major losses as percentage of net premium earned 2) |
15.9% | 3.3% | 9.2% | 1.1% | 3.9% | |||
| Retention | 84.9% | 86.8% | 85.8% | 75.8% | 77.0% | |||
| Return on investment | 4.3% | 5.4% | 4.9% | 4.2% | 4.2% | |||
| EBIT margin 3) | 8.9% | 15.9% | 12.6% | 11.8% | 11.1% | |||
| Return on equity (after tax) | 16.6% | 22.5% | 19.9% | 23.4% | 19.9% |
1) Including expenses on funds withheld and contract deposits
2) Natural catastrophes and other major losses in excess of EUR 5 million gross for the Hannover Re Group
3) Operating profit (EBIT)/net premium earned
Wilhelm Zeller Chairman of the Executive Board
Speaking at our Investors' Day in June, I underlined our expectation that 2007 will be another year of increased profitability for Hannover Re. Despite relatively significant strains from catastrophe losses, our half-yearly result shows that this expectation is realistic. With the results described here, your company has put in place a good platform for achieving its profit target for the full financial year – namely a return on equity of at least 15 percent after tax.
I am thoroughly satisfied with the development of our non-life reinsurance business group in the second quarter: at the end of May we completed the sale of our US primary insurance subsidiary Praetorian Financial Group, Inc. – active in the field of specialty business – and are now able to concentrate entirely on our core business of reinsurance. Given our strategic orientation as a "Multi Specialist", your company is broadly positioned, optimally diversified and hence well equipped for the challenges that lie ahead.
In order to derive maximum benefit from the opportunities offered by an attractive German market, we raised our stake in E+S Rück – which bears exclusive responsibility for German business within the Group – by ten percent effective 1 April to 65.8 percent.
The continuing favourable state of the property and casualty reinsurance market has positive effects on our business. Although the treaty renewals as at 1 January 2007 demonstrated that the hard market has now passed its peak, the June/July renewals in North America passed off more favourably than initially anticipated. With just a few exceptions, prices for natural catastrophe covers in the United States held stable; the premium erosion in other property reinsurance lines was moderate. After eight successive years of consistent price rises, rates are still commensurate with the risks.
As you are aware, risk management is an issue that our company takes very seriously: we have continued to scale back our peak exposures, and through new capital market transactions concluded in the first quarter we also took further steps to ensure that our equity base will not be eroded by exceptionally large losses. In addition to traditional covers we now have in place a diverse range of protection mechanisms within the scope of alternative risk transfer. Our strategy of increasingly transferring
insurance risks to the capital market improves the diversification of our protection cover programme, on the one hand, while at the same time reducing the costs of our own reinsurance with an eye to the currently high price of retrocession arrangements.
I am satisfied with the development of business with structured covers – formerly our financial reinsurance segment. We are seeing growing demand for surplus relief contracts, especially in emerging markets that are enjoying a vigorous economic boom. The recent entry into force of amendments to the Insurance Supervision Act (VAG) is a development that we expressly welcome. As part of this reform, regulations relating to financial reinsurance were also adopted which will hopefully help to eliminate the uncertainties surrounding the handling of structured products.
The development of our second business group – life and health reinsurance – continued to be highly gratifying, thus building seamlessly on the solid growth impetus of the 2006 financial year. With our "Five Pillar model" we have an excellent platform for sustainable double-digit growth. In addition to traditional life and health reinsurance, this model encompasses new business financing, the development of new products and markets, bancassurance and partnerships with large multinational clients. In the first half-year we comfortably surpassed our target of generating an EBIT margin in excess of five percent.
The performance of our investments was also most satisfactory: improved net income was generated for the first half of 2007 on the basis of higher average yields in the portfolio and significant profit-taking on equities.
After a modest performance at the beginning of the year, the Hannover Re share posted appreciable gains in the second quarter. Your company can still tap into considerable potential, and I am therefore confident that sooner or later this will be reflected in further increases in the share price.
I would like to thank you most sincerely – also on behalf of all my colleagues on the Executive Board – for your trust in Hannover Re. We are and will continue to be guided by our overriding goal of continuing to lead your company profitably into the future.
Yours sincerely,
Wilhelm Zeller Chairman of the Executive Board
| Wolf-Dieter Baumgartl 1) 2) Berg |
Chairman |
|---|---|
| Dr. Klaus Sturany 1) Dortmund |
Deputy Chairman (since 3 May 2007) |
| Herbert K. Haas 1) 2) Burgwedel |
|
| Uwe Kramp 3) Hannover (since 3 May 2007) |
|
| Karl Heinz Midunsky Gauting |
|
| Ass. jur. Otto Müller 3) Hannover |
|
| Dr. Immo Querner Ehlershausen |
|
| Ass. jur. Renate Schaper-Stewart 3) Lehrte (until 3 May 2007) |
|
| Dr. Erhard Schipporeit 2) Hannover (since 3 May 2007) |
|
| Dipl.-Ing. Hans-Günter Siegerist 3) Nienstädt (until 3 May 2007) |
|
| Gert Waechtler 3) Großburgwedel (since 3 May 2007) |
| Wilhelm Zeller Burgwedel |
Chairman |
|---|---|
| André Arrago | |
| Hannover | |
| Dr. Wolf Becke | |
| Hannover | |
| Jürgen Gräber | |
| Ronnenberg | |
| Dr. Elke König | |
| Hannover | |
| Dr. Michael Pickel | |
| Gehrden | |
| Ulrich Wallin | |
| Hannover | |
| 1) Member of the Standing Committee 2) Member of the Balance Sheet Committee |
3) Staff representative
Movements on the German equity market were very pleasing in the first half of 2007. Compared to major stock markets around the world the Dax and MDax ranked among the top performers. The Dax has put on one-fifth of its value since the beginning of the year, breaking through the 8,000 mark in June. The MDax improved by 15.7% in the same period. By way of comparison, the Dow Jones lagged well behind the European stock indices with a gain of 7.5%.
According to the International Monetary Fund, the global economy is experiencing one of its best growth phases in the past 40 years. Against this backdrop both the Federal Reserve Board and the European Central Bank are standing by their restrictive monetary policy, which is not without implications for the equity markets.
Volatility on international stock markets has increased, fuelling fears of a slump in prices. Speculative excesses, especially in the boom markets of Asia – as witnessed most recently in China – as well as smouldering problems in the US real estate market caused stock markets around the world to falter.
Turning to the Hannover Re share, it participated to some extent in the favourable trend on the German equity market during the first half of 2007. The share's performance since the turn of the year amounted to 7.1%; relative to its lowest point of the year on 15 March 2007 (EUR 30.75) the Hannover Re share posted a gain of as much as 22.2% as at 29 June 2007. Our share touched its highest mark of the year so far on 2 May 2007 with a price of EUR 37.50. This was followed by some profit-taking, and the share subsequently hovered in a range of EUR 35.50 to EUR 36.50 until the end of the second quarter.
With a dividend yield of around 5% and a price/earnings (P/E) ratio of roughly 8 on the 2007 result anticipated by analysts, the share continues to be attractively priced by industry standards.
Performance of the Hannover Re share compared with standard benchmark indices and the ABN Amro Global Reinsurance Index
The weighted ABN Amro Rothschild Global Reinsurance Index, which we consider to be our internal benchmark, generated a positive performance of 9.7% as at the mid-point of 2007 and outperformed the Hannover Re share (7.1%) in the first half of the year. The Global Reinsurance Index and the Hannover Re share have thus recovered from their negative showing in the first quarter, with the former sharing disproportionately strongly in the favourable development of individual stocks in the first half of 2007.
We rounded off our Investor Relations activities in the first half of the year with our Tenth Investors' Day. Numerous financial analysts and investors came to Hannover in order to obtain first-hand information from presentations and discussions with the Executive Board and senior managers. Special attention was devoted this year to life and health reinsurance, the business group with the greatest growth potential. The two largest life and health reinsurance markets, namely the United States and United Kingdom, were explored in more in-depth presentations. Yet non-life reinsurance was by no means neglected: speakers addressed topics such as "Hannover Re – a Multi Specialist", our securitisation transactions and risk management, and the day came to a close with a look at the prospects for 2007.
| Figures in EUR | 30.6.2007 | 2006 | 2005 | 2004 | 2003 1) | 2002 1) | ||
|---|---|---|---|---|---|---|---|---|
| Earnings per share (diluted) | 2.43 | 4.27 | 0.41 | 2.32 | 3.24 | 2.75 | ||
| Dividend per share | – | 1.60 | – | 1.00 | 0.95 | 0.85 | ||
| 1)On a US GAAP basis | ||||||||
| International Securities Identification Number (ISIN): |
DE 000 840 221 5 | |||||||
| Shareholding structure: | Talanx AG: 50.2% Free float: 49.8% |
|||||||
| Common shares as at 30 June 2007: |
EUR 120,597,134.00 | |||||||
| Number of shares as at 30 June 2007: |
120,597,134 no-par-value registered shares | |||||||
| Market capitalisation as at 30 June 2007: |
EUR 4,335.5 million |
We are well satisfied with the development of the first half-year 2007. The results of our two business groups – non-life reinsurance and life and health reinsurance – constitute a good foundation for achieving our profit target for the full financial year: a return on equity of at least 15%.
The sale of Praetorian Financial Group, Inc. – our US primary insurance subsidiary transacting specialty business – was successfully completed as at 31 May 2007. In accordance with IFRS 5 its result is reported in a separate line of the statement of income for both the second quarter and the halfyear (net income from discontinued operations). We have adjusted the figures for the corresponding period of the previous year in order to ensure comparability.
In view of the considerably brighter state of the market in the reinsurance sector, we shall use the risk capital that has been freed up to expand our portfolio in attractive areas of non-life and life/ health reinsurance.
Gross written premium in total business amounted to EUR 4.5 billion (EUR 5.0 billion) as at 30 June 2007; this corresponds to a decline of 10.4% compared to the same period of the previous year. Key factors here were the sale of Praetorian and the associated withdrawal of Clarendon too from active specialty business. These effects were not entirely offset by the growth in life and health reinsurance. At constant exchange rates premium would have contracted by 7.8%. Due to lower retrocessions the level of retained premium climbed to 85.8% (77.0%), causing net premium to increase by 1.9% to EUR 3.7 billion (EUR 3.6 billion).
Overall, the performance of our investments was satisfactory. The comparatively slight rise in the portfolio of self-managed assets can be attributed primarily to the offsetting effect of the movement in the US dollar in conjunction with moderate cash inflows. Ordinary income (excluding interest on deposits) nevertheless improved on the previous year's figure of EUR 385.1 million to EUR 409.5
million. This was due principally to the higher average yield generated in the portfolios. The pleasing performance of equity markets did not entirely offset the worldwide increase in yields on fixed-income securities, leading to erosion of the unrealised gains and losses in the Group's portfolio. Extraordinary profit-taking on equities produced inter alia an improvement of some 29.7% in income from assets under own management, thereby more than making up for the continued decline in interest on deposits. Against this backdrop, net investment income surged by a gratifying 19.8% to EUR 579.9 million (EUR 483.9 million).
The operating profit (EBIT) grew by 15.8% as at 30 June 2007 to EUR 467.7 million (EUR 403.9 million). Group net income increased by 14.2% to EUR 293.0 million (EUR 256.6 million). This figure includes a deconsolidation profit of EUR 17.7 million on the sale of Praetorian. Earnings per share stood at EUR 2.43 (EUR 2.13), corresponding to an annualised return on equity of 19.9%.
Our financial strength also continues to be very solid; the balance sheet structure has improved still further following the sale of Praetorian. Shareholders' equity grew by EUR 78.5 million relative to the position as at 31 December 2006 to stand at EUR 3.0 billion. The book value per share consequently also increased by 2.7%. The policyholders' surplus, comprised of shareholders' equity, minority interests and hybrid capital, stood at EUR 4.8 billion (EUR 4.9 billion).
Risk management is an issue of vital importance to our company: as part of our quantitative approach to risk management the most significant risks in non-life reinsurance – such as the reserving and natural catastrophe exposure risks – are actuarially assessed using mathematical methods. At the heart of our qualitative risk management is our constant monitoring and controlling of all risks; in this context special attention is paid to operational risks, which we track, assess and minimise using appropriate measures.
We are standing by our strategy of increasingly transferring insurance risks to the capital market. In this way we are able to better diversify our programme of protection cover and thereby reduce our expenditure on costly reinsurance ar-
After eight consecutive years of rate increases the state of the market in non-life reinsurance remains favourable. Following on from the pleasing results of the treaty renewals as at 1 January 2007, the outcome of the renewal season as at 1 April in Japan and Korea was also gratifying. Treaty negotiations with our US clients as at 1 June and 1 July passed off more favourably than anticipated. Although the primary market in North America is now seeing a softening of rates, the reinsurance market was very largely able to distance itself from this trend. Rates declined slightly in property business, but the situation here is still adequate. In US property catastrophe business prices remained on a very high level, with modest rate reductions in only a few areas. While the hard market has now passed its peak, the prospects for our non-life reinsurance business are still most promising.
The renewal phases once again demonstrated that ceding companies attach considerable importance to their reinsurers' ratings. This is especially true of long-tail liability lines. Based on our very good ratings we were able to profit from this situation particularly strongly.
The development of our portfolio in Germany was especially pleasing: thanks to new client relationships and increased treaty shares under existing accounts we were able to boost our already large market share and extend our position as one of the leading reinsurers on the profitable German market.
In non-life reinsurance, as in past years, lowervolume but higher-margin non-proportional business made up the bulk of our acceptances – acrangements. In the first quarter we completed a number of capital market transactions ("K5", "Merlin" and "Kepler Re") to protect against various exposures.
counting for more than 80% of the treaties written and around half the total premium income.
With an eye to the enormous growth potential offered by the global Islamic insurance market, we are pursuing a policy of systematically cultivating and expanding this business through our subsidiary in Bahrain.
After the anticipated subdued start in the first quarter, demand for structured covers has gathered pace – especially in European and Asian markets. Particularly crucial factors here are the economic boom in emerging markets and the associated surge in demand for reinsurance products with equity substitute components. The growing use of risk capital models is also fuelling demand. Yet in the United States, too, interest in structured covers is likely to pick up as the requirements of highly sophisticated capital and risk management make the use of such products a sensible choice.
What is more, we take a positive view of the amendments to the German Insurance Supervision Act (VAG) that recently entered into force on the basis of an EU Directive. As part of the Eighth Amendment to the Insurance Supervision Act, regulations have also been put in place governing the assessment of an adequate risk transfer in financial reinsurance. This legislation should create considerably more certainty in the market in relation to the handling of structured products.
The sale of Praetorian Insurance Group, Inc., our US subsidiary transacting specialty business, was successfully completed in the second quarter. The volume of primary insurance business remaining within the Hannover Re Group is thus minimal. Now that the Clarendon Insurance Group has stopped actively writing specialty insurance and is responsible solely for the management and run-off of existing business, we are able to concentrate exclusively on our attractive core business of reinsurance.
| Figures in EUR million | 2007 | 2006 | |||||
|---|---|---|---|---|---|---|---|
| 1.1.–31.3. | 1.4.–30.6. +/- previous year |
1.1.–30.6. +/- previous year |
1.4.–30.6. | 1.1.–30.6. | |||
| Gross written premium | 1,664.4 | 1,300.1 | -22.5% | 2,964.4 | -20.5% | 1,677.9 | 3,730.0 |
| Net premium earned | 1,092.6 | 1,235.9 | -0.7% | 2,328.5 | -7.3% | 1,244.1 | 2,512.7 |
| Underwriting result | (66.2) | 10.1 | -157.9% | (56.1) | +276.9% | (17.4) | (14.9) |
| Net investment income | 177.9 | 233.9 | +42.6% | 411.8 | +26.7% | 164.0 | 325.0 |
| Operating result (EBIT) | 93.3 | 228.2 | +49.3% | 321.5 | +5.9% | 152.8 | 303.6 |
| Group net income | 102.0 | 139.4 | +14.0% | 241.4 | +9.4% | 122.3 | 220.6 |
| Earnings per share in EUR | 0.85 | 1.15 | +14.0% | 2.00 | +9.4% | 1.01 | 1.83 |
| Retention | 83.8% | 82.7% | 83.3% | 70.8% | 73.2% | ||
| Combined ratio 1) | 105.2% | 98.9% | 101.9% | 100.3% | 99.4% |
1) Including expenses on funds withheld and contract deposits
All in all, we are thoroughly satisfied with the development of our non-life reinsurance business group. As expected, gross premium volume as at 30 June 2007 came in lower than in the same period of the previous year, falling by 20.5% to EUR 3.0 billion (EUR 3.7 billion). At constant exchange rates, especially against the US dollar, the decline would have been 18.1%. Owing to a sharply higher retention of 83.3% (73.2%), driven in large measure by the reduction in fronting business written by Clarendon for Praetorian, net premium earned fell by a mere 7.3% to EUR 2.3 billion (EUR 2.5 billion).
Following rather heavy expenditure on major claims in the first quarter – attributable to the severe winter storm "Kyrill" in Europe –, we incurred a number of small and mid-sized natural catastrophe losses towards the end of the second
In life and health reinsurance we transact our business on the basis of our "5 pillar model":
quarter: storms and heavy rainfall brought flooding to Australia and parts of the Arab world. In the United Kingdom, too, we were impacted by a severe flood event. The total net burden of catastrophe losses and major claims in the second quarter stood at EUR 46.3 million; the figure for the first half of the year amounted to EUR 214.5 million, equivalent to 9.2% of net premium in non-life reinsurance. The combined ratio came in at 101.9% (99.4%).
The net underwriting result fell to -EUR 56.1 million (-EUR 14.9 million). The operating profit (EBIT) in non-life reinsurance improved by 5.9% to EUR 321.5 million (EUR 303.6 million). Group net income climbed by 9.4% to EUR 241.4 million (EUR 220.6 million), generating earnings of EUR 2.00 (EUR 1.83) per share.
Development of new markets and products such as special seniors' and annuity products,
Bancassurance,
This broad positioning enables us to enjoy a promising portfolio and vigorous organic growth.
As expected, our life and health reinsurance portfolio continued to deliver dynamic growth in the first half of 2007, and we were again able to substantially expand our premium volume. We remain focused on profitable niche segments. In the area of new business financing we are supporting one of the leading life insurers in the United Kingdom, whose innovative risk products have been successfully launched on the market.
We are also actively involved in the development of Islamic insurance markets, assisting our clients not only with the design of insurance products in accordance with Islamic principles but also with an eye to marketing and sales methods.
Within traditional life and health business our current concentration is on the markets of the United Kingdom, Italy, South Africa, Australia/New Zealand and Asia. In the United Kingdom our focus continued to be on enhanced annuities, while in the United States special health insurance products aimed at senior citizens offered attractive growth prospects.
In Europe we continue to concentrate on expanding our bancassurance business; our activities in this sector are currently centred on Greece, Cyprus and Turkey in particular.
| Figures in EUR million | 2007 | 2006 | |||||
|---|---|---|---|---|---|---|---|
| 1.1.–31.3. | 1.4.–30.6. +/-previous year |
1.1.–30.6. +/-previous year |
1.4.–30.6. | 1.1.–30.6. | |||
| Gross written premium | 744.1 | 788.2 | +16.4% | 1,532.3 | +19.5% | 676.9 | 1,282.6 |
| Net premium earned | 644.2 | 732.5 | +22.5% | 1,376.7 | +22.5% | 598.2 | 1,124.0 |
| Net investment income | 67.9 | 81.4 | +16.1% | 149.2 | +11.9% | 70.1 | 133.3 |
| Operating profit (EBIT) | 51.8 | 77.4 | +48.0% | 129.2 | +65.2% | 52.3 | 78.2 |
| Group net income | 33.9 | 56.0 | +50.8% | 89.9 | +75.8% | 37.1 | 51.2 |
| Earnings per share in EUR | 0.28 | 0.47 | +50.8% | 0.75 | +75.8% | 0.31 | 0.42 |
| Retention | 87.4% | 92.9% | 90.2% | 88.3% | 88.0% | ||
| EBIT margin 1) | 8.1% | 10.6% | 9.4% | 8.7% | 7.0% |
1) Operating profit (EBIT)/net premium earned
Gross written premium increased by a vigorous 19.5% to EUR 1.5 billion as at 30 June 2007 (EUR 1.3 billion). At constant exchange rates growth would have been 22.8%. The level of retained premium rose slightly to 90.2% (88.0%). Net premium earned consequently increased by as much as 22.5% to EUR 1.4 billion (EUR 1.1 billion).
Results as at 30 June 2007 were also most satisfactory: the operating profit (EBIT) was boosted by 65.2% to EUR 129.2 million (EUR 78.2 million). This amount includes extraordinary income of some EUR 25 million from the write-back of reserves that are no longer required. The EBIT margin of 9.4% was comfortably in excess of the minimum target of 5%; even without the aforementioned special effects it would have been a highly satisfactory 7.5%; Group net income climbed by a very good 75.8% to EUR 89.9 million (EUR 51.2 million), corresponding to earnings of EUR 0.75 (EUR 0.42) per share.
The international – and especially European – equity markets got off to a good start at the turn of the year. Price declines in February/March and again in the first half of June were each offset by subsequent rallies. The downward slide in June had been prompted by speculation in the US mortgage sector after the release of poor business data for subprime loans. This caution and the susceptibility of the markets to such announcements are still prevalent in the current climate.
Increased volatility in almost all durations was still the hallmark of American and European bond markets. Significant increases were observed along the yield curves in almost all currency areas in the first half of 2007. Our principal focus in the area of fixed-income securities therefore continues to be on high quality and liquidity while maintaining a neutral duration.
The inflow of cash combined with offsetting market movements and especially a weaker US dollar caused the portfolio of self-managed assets – amounting to EUR 19.5 billion – to remain nearly unchanged compared to the level as at 31 December 2006.
Ordinary income excluding interest on deposits climbed by 6.3% to EUR 409.5 million, as against EUR 385.1 million in the corresponding period of the previous year. The primary factor here was the higher average yield in the asset portfolios. The gratifying performance of equity markets did not entirely make up for the worldwide rise in yields on fixed-income securities, leading to an erosion of the unrealised gains and losses in the Group's portfolio.
As part of our proactive approach to portfolio management – especially in the field of equities and alternative investments – we made the most of the positive market trend to realise profits of EUR 134.3 million (EUR 49.9 million) on the disposal of investments, as against virtually unchanged realised losses of EUR 36.7 million (EUR 38.0 million). Net income from the portfolio of assets under own management climbed 29.7% to EUR 482.0 million (EUR 371.5 million). Interest on deposits stood at EUR 98.0 million and continued to decline (EUR 112.4 million). Total net investment income improved by an appreciable 19.8% year-on-year thanks to the very pleasing performance of our self-managed assets to reach EUR 579.9 million (EUR 483.9 million).
| Figures in EUR million | 2007 | 2006 | |
|---|---|---|---|
| 30.6. | +/- previous year | 30.6. | |
| Ordinary investment income 1) | 409,5 | +6.3% | 385,1 |
| Results from participation in associated companies | 3,5 | +191.4% | 1,2 |
| Realised gains/losses | 97,6 | +720.4% | 11,9 |
| Impairments | -0,3 | -95.9% | -8,3 |
| Unrealised gains/losses – trading | -0,1 | -101.4% | 10,2 |
| Investment expenses 2) | -28,1 | -2.1% | -28,7 |
| Net investment income from assets under own management | 482,0 | +29.7% | 371,5 |
| Net investment income from funds withheld | 98,0 | -12.9% | 112,4 |
| Total investment income | 579,9 | +19.8% | 483,9 |
1) Excl. expense on funds withheld and contract deposits
2) Incl. depreciation/impairments on real estate
Our risk management is guided by the principle of optimally exploiting opportunities while at the same time adequately controlling and managing the risks associated with our business activities. The following strategic elements are the hallmarks of our Group-wide risk management:
• Ongoing internal and external review of the efficiency of the implemented systems
One core element of our integrated approach to the management of opportunities and risks is the optimisation of our capital requirements with the aid of mathematical aggregate loss modelling techniques, inter alia with an eye to our natural hazards exposure.
Based on the defined risk appetite, this enables us to improve profitability through the targeted use of traditional protection cover programmes and capital market transactions (e.g. "K5", "Kepler Re", "Eurus"). We are thus able to allocate capital to the most profitable business segments in light of risk/opportunity considerations.
The risk situation of Hannover Re is essentially defined by comprehensive analysis of the following risk categories.
| Risk category | Major risks | Key risk management activities |
|---|---|---|
| Global risks | External risks that are beyond our direct sphere of influence, e.g. from legislation and court practice |
• Monitoring of relevant legal areas and analysis of claims trends • Proactive adjustment of underwriting policy |
| Strategic risks | Imbalance between the defined corporate strategy and changing framework conditions, e.g. as a result of inconsistent strategy implementation |
• Regular review and, as necessary, adjustment of our strategy, structures and processes, e.g. by means of systematic quality and process manage ment |
| Operating risks | ||
| Technical risks | Divergence of cash flows in (re-)insurance business from their expected values (risks of random fluctuation, error and change), e.g. due to natural catastrophes (Kyrill) and/or other major losses, miscalculation of mortality, life expectancy and disability probabilities |
Across all lines of business • Risk spreading through diversification of the port folio Non-life reinsurance • Calculation of the loss reserves on an actuarial basis and additional review of the adequacy of reserves by external actuaries and auditors |
| Risk category | Major risks | Key risk management activities |
|---|---|---|
| • Risk reduction through retrocessions to the insur ance and capital markets |
||
| • Monitoring of the natural hazards exposure (mod elling, aggregate control) |
||
| Life and health reinsurance | ||
| • Review of the risk feasibility of new business activities and of the assumed international port folio |
||
| • Use of secure biometric actuarial bases |
||
| Investment risks | Decrease in the fair value of investments due to mar ket, credit, liquidity and currency risks |
• Orientation of investments to the requirements of the reinsurance business through Group-wide investment guidelines |
| • Systematic adherence to the principle of matching currency cover |
||
| • Systematic approach to asset/liability manage ment |
||
| • Clear distinction between trading, settlement and risk control based on the principle of separation of functions applied through to the level of management |
||
| • Partial hedging of portfolios, especially with an eye to price, currency and interest rate risks, through short call and long put options as well as swaps |
||
| Operational risks | Risk of losses occurring because of the inadequacy or failure of internal procedures, human error/system failure or external events, e.g. IT failure, pandemic |
• Internal control system, contingency plans (e.g. crisis communication), backup computer centre and alternative workplaces for emergencies |
| Figures in % | 1H 2007 | 2006 | 2005 | 2004 | 2003 1) | 2002 1) | 2001 1) | 2000 1) | 1999 1) | 1998 1) | 1997 2) |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Combined ratio | 101.9 | 98.4 | 112.8 | 97.2 | 96.0 | 96.3 | 116.5 | 107.8 | 111.1 | 108.1 | 99.5 |
| thereof catastrophe losses 3) |
9.2 | 2.7 | 26.3 | 8.3 | 1.5 | 5.2 | 23.0 | 3.7 | 11.4 | 3.5 | 1.5 |
1) Based on US GAAP
2 ) Based on the German Commercial Code (HGB) 3) Natural catastrophes and other major losses in excess of EUR 5 million gross for the Hannover Re Group
| Government bonds | Securities issued by semi-governmental entities |
Corporate bonds | Asset-backed securities | |||||
|---|---|---|---|---|---|---|---|---|
| Rating | in % | in EUR million | in % | in EUR million | in % | in EUR million | in % | in EUR million |
| AAA | 89.8% | 3,208.3 | 55.9% | 2,351.3 | 7.1% | 347.9 | 80.1% | 2,337.9 |
| AA | 1.9% | 69.7 | 36.2% | 1,524.2 | 28.2% | 1,396.4 | 15.1% | 439.1 |
| A | 6.0% | 212.9 | 6.7% | 281.7 | 48.7% | 2,410.4 | 2.1% | 61.3 |
| BBB | 2.3% | 83.0 | 0.9% | 39.5 | 9.6% | 472.9 | 0.2% | 7.2 |
| >BBB | 0.0% | 0.0 | 0.2% | 10.4 | 6.4% | 317.1 | 2.5% | 71.7 |
| Total | 100.0% | 3,573.8 | 100.0% | 4,207.1 | 100.0% | 4,944.7 | 100.0% | 2,917.2 |
Scenarios for changes in the fair value of our securities as at the balance sheet date
| Portfolio | Scenario | Portfolio change based on fair value in EUR million |
|---|---|---|
| Equity securities | Share prices +10% | 172.9 |
| Share prices +20% | 345.8 | |
| Share prices (10%) | (172.9) | |
| Share prices (20%) | (345.8) | |
| Fair value as at 30.6.2007 | 1,729.0 | |
| Fixed-income securities | Yield increase +50 basis points | (340.2) |
| Yield increase +100 basis points | (656.6) | |
| Yield decrease (50 basis points) | 334.7 | |
| Yield decrease (100 basis points) | 693.1 | |
| Fair value as at 30.6.2007 | 15,550.3 |
In the context of our worldwide operations we are exposed to a diverse spectrum of potential risks. These risks, however, always go hand-in-hand with corresponding opportunities. On the basis of our holistic approach to risk management, arrived at from an overall analysis of our business environment, we cannot discern any risks that could jeopardise the continued existence of our company in the short or medium term or have a significant, lasting effect on our assets, financial position or net income.
Detailed information on the organisation of our risk management and on further risk management measures is provided in the Annual Report for the financial year ending 31 December 2006.
In view of the attractive market opportunities available in both our business groups of non-life reinsurance and life/health reinsurance as well as the current state of capital markets, we are looking forward to a very good result in 2007.
We have already used the risk capital released by the sale of Praetorian to tap into other promising opportunities in the reinsurance sector. Profitable growth prospects are available, for example, by running a higher retention in the still lucrative segment of property catastrophe business, and they can also be accessed in life and health reinsurance as well as through the cultivation of new markets in Central and Eastern Europe, not to mention the high-growth area of Islamic reinsurance business. The increase of our stake in E+S Rück – which bears sole responsibility for the Group's attractive German business – at the beginning of the second quarter was also prompted by this strategy.
Within the scope of our own risk management we continue to rely primarily on the transfer of risks to the capital market. Going forward, however, we also intend to structure capital market securitisations for other companies and have set up a special department for this purpose.
We expressly welcome the Solvency II draft directive presented by the European Commission. Also, Hannover Re has actively participated in the so-called Quantitative Impact Studies. Yet numerous questions still remain unresolved; not least, it remains to be seen how far the capital adequacy standards of regulators will in future correspond to those of rating agencies.
Market conditions in non-life reinsurance remain largely good, as is borne out by all the treaty renewals completed in the course of the year to date. The latest renewal phase as at 1 July 2007 in the United States, in which around one third of our portfolio in North America was renegotiated, impressively confirmed this trend. Although the hard market has now passed its peak and some ceding
companies are raising their retentions, the rate level remained attractive on the whole. Some modest deterioration was observed in property business, but the rates for business written by our company are still commensurate with the risks. Prices for US catastrophe business continue to be on a high level, with just a few subsegments seeing minimal erosion.
In the current third quarter the plane crash in Brazil constitutes a major loss for our account put at around EUR 15 million on the basis of the information available at this time. According to current estimates, the earthquake in Japan is not expected to produce any significant loss expenditure. It is not yet possible to quantify the strain from the flooding in the southwest of England; nevertheless, our current expectation is that the loss burden will be moderate.
All in all, we expect the premium volume in non-life reinsurance to at least match up to the previous year. Provided the burden of major losses remains within the expected bounds of around 8% of net premium, we anticipate another gratifying profit contribution.
In life and health reinsurance we are looking to further healthy growth stimuli, inter alia from European markets as well as various Asian markets and South Africa. Not only that, our pilot projects in the US market aimed at opening up growth opportunities for alternative sales channels through systemsupported underwriting are bearing fruit; it is our expectation, therefore, that the marketing of simple, transparent life insurance products will inject fresh growth impetus into the US life market. For the business group as a whole we anticipate significant growth in premium volume and double-digit increases in results.
The expected positive underwriting cash flow is likely to boost the volume of assets as the year progresses. Given a normal market environment the income generated from investments under our own management should continue to grow.
In view of the development to date of our business groups and the general economic climate, we are confident that 2007 will prove to be another highly successful financial year. Assuming that the burden of major losses is in line with the expected level of around 8% of net premium in non-life reinsurance and as long as there are no unexpectedly adverse movements on capital markets, another excellent result should be attainable in the current year. In addition, we anticipate revenue of some EUR 180 million from the reform of corporate taxation. A return on equity of at least 15% is expected for the 2007 financial year. Even excluding the nonrecurring effect of the tax reform, the result should come in higher than that of 2006. It remains our goal to pay a dividend in the range of 35% to 40% of the ordinary result
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| Assets | 30.6. | 31.12. |
| Fixed-income securities – held to maturity | 1,553,965 | 1,602,057 |
| Fixed-income securities – loans and receivables | 1,227,301 | 915,593 |
| Fixed-income securities – available for sale | 12,696,775 | 13,062,150 |
| Fixed-income securities – at fair value through profit or loss | 164,874 | 166,463 |
| Equity securities – available for sale | 1,729,018 | 1,586,071 |
| Equity securities – at fair value through profit or loss | – | 10,207 |
| Other financial assets – at fair value through profit or loss | 19,590 | 22,368 |
| Real estate | 17,565 | 17,979 |
| Investments in associated companies | 164,607 | 166,646 |
| Other invested assets | 665,495 | 623,329 |
| Short-term investments | 898,072 | 721,287 |
| Cash | 390,422 | 351,776 |
| Total investments and cash under own management | 19,527,684 | 19,245,926 |
| Funds held | 9,043,998 | 8,730,734 |
| Contract deposits | 618,898 | 561,426 |
| Total investments | 29,190,580 | 28,538,086 |
| Reinsurance recoverables on unpaid claims | 2,811,992 | 3,048,496 |
| Reinsurance recoverables on benefit reserve | 345,276 | 447,537 |
| Prepaid reinsurance premium | 229,901 | 339,096 |
| Reinsurance recoverables on other technical reserves | 8,863 | 7,822 |
| Deferred acquisition costs | 2,223,760 | 2,228,152 |
| Accounts receivable | 3,022,419 | 2,609,264 |
| Goodwill | 47,028 | 152,639 |
| Deferred tax assets | 942,643 | 844,921 |
| Other assets | 327,184 | 261,435 |
| Accrued interest and rent | 5,183 | 2,785 |
| Assets classified as held for sale | – | 2,906,123 |
| 39,154,829 | 41,386,356 |
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| Liabilities | 30.6. | 31.12. |
| Loss and loss adjustment expense reserve | 17,608,317 | 17,596,325 |
| Benefit reserve | 6,289,988 | 6,109,154 |
| Unearned premium reserve | 1,601,732 | 1,581,034 |
| Provisions for contingent commissions | 220,889 | 200,769 |
| Funds held | 1,149,149 | 1,419,444 |
| Contract deposits | 3,870,846 | 3,526,781 |
| Reinsurance payable | 1,005,454 | 1,215,833 |
| Provisions for pensions | 66,313 | 64,559 |
| Taxes | 285,996 | 190,580 |
| Provision for deferred taxes | 1,923,527 | 1,756,897 |
| Other liabilities | 262,860 | 248,854 |
| Long-term debt and subordinated capital | 1,418,725 | 1,428,893 |
| Liabilities related to assets classified as held for sale | – | 2,540,847 |
| Total liabilities | 35,703,796 | 37,879,970 |
| Shareholders' equity | ||
| Common shares | 120,597 | 120,597 |
| Nominal value 120,597 Authorised capital 60,299 | ||
| Additional paid-in capital | 724,562 | 724,562 |
| Common shares and additional paid-in capital | 845,159 | 845,159 |
| Cumulative other comprehensive income | ||
| Unrealised gains and losses on investments | 140,052 | 144,199 |
| Cumulative foreign currency translation adjustment | (96,697) | (71,518) |
| Other changes in cumulative other comprehensive income | (1,886) | (1,526) |
| Total other comprehensive income | 41,469 | 71,155 |
| Retained earnings | 2,089,749 | 1,981,521 |
| Shareholders' equity before minorities | 2,976,377 | 2,897,835 |
| Minority interests | 474,656 | 608,551 |
| Total shareholders' equity | 3,451,033 | 3,506,386 |
| 39,154,829 | 41,386,356 |
| Figures in EUR thousand | 2007 | 2006 | ||
|---|---|---|---|---|
| 1.4.–30.6. | 1.1.–30.6. | 1.4.–30.6. | 1.1.–30.6. | |
| Gross written premium | 2,083,126 | 4,491,568 | 2,354,732 | 5,012,547 |
| Ceded written premium | 276,066 | 639,021 | 569,855 | 1,153,254 |
| Change in gross unearned premium | 222,006 | (43,892) | 78,766 | (262,786) |
| Change in ceded unearned premium | (60,707) | (103,482) | (21,326) | 40,183 |
| Net premium earned | 1,968,359 | 3,705,173 | 1,842,317 | 3,636,690 |
| Ordinary investment income | 214,265 | 409,465 | 197,975 | 385,148 |
| Profit/loss from investments in associated companies | 2,497 | 3,473 | 870 | 1,192 |
| Income/expense on funds withheld and contract deposits | 51,220 | 97,951 | 58,244 | 112,421 |
| Realised gains on investments | 94,165 | 134,320 | 28,751 | 49,870 |
| Realised losses on investments | 25,238 | 36,737 | 24,956 | 37,976 |
| Unrealised gains and losses on investments | (15) | (141) | 2,474 | 10,207 |
| Total depreciation, impairments and appreciation of investments | 215 | 617 | 6,116 | 11,197 |
| Other investment expenses | 11,815 | 27,798 | 13,215 | 25,758 |
| Net investment income | 324,864 | 579,916 | 244,027 | 483,907 |
| Other technical income | 999 | 1,275 | 711 | 910 |
| Total revenues | 2,294,222 | 4,286,364 | 2,087,055 | 4,121,507 |
| Claims and claims expenses | 1,325,051 | 2,545,042 | 1,331,372 | 2,531,434 |
| Change in benefit reserves | 100,696 | 214,492 | 2,164 | 67,513 |
| Commission and brokerage, change in deferred acquisition costs | 491,589 | 921,058 | 487,702 | 976,527 |
| Other acquisition costs | 1,577 | 8,165 | 2,739 | 10,313 |
| Other technical expenses | 2,000 | 9,178 | 10,246 | 20,002 |
| Administrative expenses | 51,911 | 100,587 | 45,241 | 97,204 |
| Total technical expenses | 1,972,824 | 3,798,522 | 1,879,464 | 3,702,993 |
| Other income and expenses | (7,887) | (20,143) | 10,014 | (14,629) |
| Operating profit/loss (EBIT) | 313,511 | 467,699 | 217,605 | 403,885 |
| Interest on hybrid capital | 19,354 | 38,517 | 19,262 | 38,497 |
| Net income before taxes | 294,157 | 429,182 | 198,343 | 365,388 |
| Taxes | 118,886 | 139,864 | 38,055 | 92,194 |
| Net income from continuing operations | 175,271 | 289,318 | 160,288 | 273,194 |
| Net income from discontinued operations | 15,452 | 30,712 | 11,503 | 28,954 |
| Net income | 190,723 | 320,030 | 171,791 | 302,148 |
| thereof | ||||
| Minority interest in profit and loss | 21,293 | 27,059 | 20,947 | 45,573 |
| Group net income | 169,430 | 292,971 | 150,844 | 256,575 |
| Earnings per share | ||||
| Earnings per share in EUR | 1.41 | 2.43 | 1.25 | 2.13 |
| from continuing operations in EUR | 1.28 | 2.18 | 1.16 | 1.89 |
| from discontinued operations in EUR | 0.13 | 0.25 | 0.09 | 0.24 |
of changes in shareholders' equity 2007
| Figures in EUR thousand |
Common shares |
Additional paid-in capital |
Other reserves (cumulative other comprehensive income) |
Retained earnings |
Minority interests |
Shareholders' equity |
||
|---|---|---|---|---|---|---|---|---|
| Currency translation |
Unrealised gains/losses |
Other | ||||||
| Balance as at 1.1.2006 |
120,597 | 724,562 | 64,934 | 225,391 | (1,582) | 1,467,132 | 556,453 | 3,157,487 |
| Capital increases/ additions |
15,832 | 15,832 | ||||||
| Capital repayments | (3,730) | (3,730) | ||||||
| Effects pursuant to IAS 8 |
(2,515) | (2,515) | ||||||
| Income and expenses directly recognised in equity |
(111,316) | (297,725) | 118 | (20,099) | (429,022) | |||
| Tax effects on income and expenses directly recognised in equity |
8,667 | 102,548 | (35) | 111,180 | ||||
| Dividend paid | (9,878) | (9,878) | ||||||
| Net income | 256,575 | 45,573 | 302,148 | |||||
| Balance as at 30.6.2006 |
120,597 | 724,562 | (37,715) | 30,214 | (1,499) | 1,723,707 | 581,636 | 3,141,502 |
| Balance as at 1.1.2007 |
120,597 | 724,562 | (71,518) | 144,199 | (1,526) | 1,981,521 | 608,551 | 3,506,386 |
| Income and expenses directly recognised in equity |
(23,056) | (47,526) | (521) | 8,212 | (129,676) | (192,567) | ||
| Tax effects on income and expenses directly recognised in equity |
(2,123) | 43,379 | 161 | 41,417 | ||||
| Dividends paid | (192,955) | (31,278) | (224,233) | |||||
| Net income | 292,971 | 27,059 | 320,030 | |||||
| Balance as at 30.6.2007 |
120,597 | 724,562 | (96,697) | 140,052 | (1,886) | 2,089,749 | 474,656 | 3,451,033 |
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 1.1.–30.6. | 1.1.–30.6. | |
| I. Cash flow from operating activities | ||
| Net income | 320,030 | 302,148 |
| Appreciation/depreciation | 8,865 | 18,311 |
| Net realised gains and losses on investments | (97,583) | (11,894) |
| Net realised gains and losses on disposal of discontinued operations | (87,723) | – |
| Amortisation of investments | (2,857) | (5,371) |
| Changes in funds held | (649,338) | 865,915 |
| Net changes in contract deposits | 302,727 | (210,596) |
| Changes in prepaid reinsurance premium (net) | 147,352 | 431,934 |
| Changes in tax assets/provisions for taxes | 203,452 | 81,394 |
| Changes in benefit reserves (net) | 323,582 | (182,285) |
| Changes in claims reserves (net) | 401,212 | 69,200 |
| Changes in deferred acquisition costs | (6,933) | (129,630) |
| Changes in other technical provisions | 22,303 | 35,334 |
| Changes in clearing balances | (641,653) | (275,229) |
| Changes in other assets and liabilities (net) | (82,950) | 27,747 |
| Cash flow from operating activities | 160,486 | 1,016,978 |
| II. Cash flow from investing activities | ||
| Fixed-income securities – held to maturity | ||
| Maturities | 62,033 | 43,048 |
| Purchases | (25,435) | (15,953) |
| Fixed-income securities – loans and receivables | ||
| Maturities, sales | 9,966 | 453 |
| Purchases | (314,277) | (41,839) |
| Fixed-income securities – available for sale | ||
| Maturities, sales | 2,885,365 | 3,227,057 |
| Purchases | (2,830,251) | (3,861,610) |
| Fixed-income securities – at fair value through profit or loss | ||
| Maturities, sales | 12,058 | 10,359 |
| Purchases | (8,716) | (28,491) |
| Equity securities – available for sale | ||
| Sales | 442,837 | 437,261 |
| Purchases | (402,891) | (709,757) |
| Equity securities – at fair value through profit or loss | ||
| Sales | 20,340 | – |
| Purchases | (10,207) | (10,000) |
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 1.1.–30.6. | 1.1.–30.6. | |
| Other trading securities | ||
| Sales | 387 | – |
| Other invested assets | ||
| Sales | 69,235 | 31,119 |
| Purchases | (67,287) | (42,714) |
| Affiliated companies and participating interests | ||
| Sales | 606,542 | 6,651 |
| Purchases | (135,699) | (11,325) |
| Real estate | ||
| Sales | – | 769 |
| Purchases | – | (316) |
| Short-term investments | ||
| Changes | (187,506) | (44,444) |
| Other changes (net) | (14,182) | (10,938) |
| Cash flow from investing activities | 112,312 | (1,020,670) |
| III. Cash flow from financing activities | ||
| Contribution from capital measures | 736 | 12,409 |
| Dividends paid | (224,234) | (9,878) |
| Proceeds from long-term debts | – | 1,522 |
| Repayment of long-term debts | (9,981) | (31,100) |
| Other changes | 3,530 | 2,515 |
| Cash flow from financing activities | (229,949) | (24,532) |
| IV. Exchange rate differences on cash | (4,203) | (19,159) |
| Change in cash and cash equivalents (I.+II.+III.+IV.) | 38,646 | (47,383) |
| Cash and cash equivalents at the beginning of the period | 351,776 | 465,161 |
| Change in cash and cash equivalents according to cash flow statement | 38,646 | (47,383) |
| Cash and cash equivalents at the end of the period | 390,422 | 417,778 |
| Income taxes | (45,779) | (24,421) |
| Interest paid | (90,795) | (120,587) |
Hannover Re's segmental report is based on IAS 14 "Segment Reporting" and on the principles set out in German Accounting Standard No. 3 "Segment Reporting" (DRS 3) of the German Standards Council, supplemented by the requirements of DRS 3–20 "Segment Reporting of Insurance Enterprises".
The segments are shown after consolidation of internal transactions within the individual segment, but before consolidation across the segments. This is reported separately in the "Consolidation" column.
Segmentation of assets
| Figures in EUR thousand | Non-life reinsurance | |
|---|---|---|
| 2007 | 2006 | |
| 30.6. | 31.12. | |
| Assets | ||
| Held to maturity | 1,335,254 | 1,365,473 |
| Loans and receivables | 987,200 | 715,334 |
| Available for sale | 11,569,717 | 11,736,891 |
| At fair value through profit or loss | 104,426 | 114,072 |
| Trading | 13,593 | 15,577 |
| Other invested assets | 783,468 | 748,071 |
| Short-term investments | 540,407 | 564,903 |
| Cash | 243,920 | 269,911 |
| Total investments and cash under own management | 15,577,985 | 15,530,232 |
| Funds held by ceding companies | 1,083,562 | 1,106,247 |
| Contract deposits | 86 | 84 |
| Total investments | 16,661,633 | 16,636,563 |
| Reinsurance recoverables on unpaid claims | 2,698,471 | 2,935,168 |
| Reinsurance recoverables on benefit reserves | – | – |
| Prepaid reinsurance premium | 220,738 | 329,505 |
| Reinsurance recoverables on other reserves | 1,246 | 1,536 |
| Deferred acquisition costs | 319,210 | 305,233 |
| Accounts receivable | 2,163,241 | 2,068,526 |
| Other assets in the segment | 1,596,732 | 1,543,208 |
| Assets classified as held for sale | – | 2,906,123 |
| Total | 23,661,271 | 26,725,862 |
| Life and health reinsurance | Consolidation | Total | |||
|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 | 2007 | 2006 |
| 30.6. | 31.12. | 30.6. | 31.12. | 30.6. | 31.12. |
| 45,146 | 63,606 | 173,565 | 172,978 | 1,553,965 | 1,602,057 |
| 81,980 | 63,302 | 158,121 | 136,957 | 1,227,301 | 915,593 |
| 2,272,499 | 2,259,864 | 583,577 | 651,466 | 14,425,793 | 14,648,221 |
| 35,313 | 36,116 | 25,135 | 26,482 | 164,874 | 176,670 |
| 5,997 | 6,791 | – | – | 19,590 | 22,368 |
| 64,199 | 59,883 | – | – | 847,667 | 807,954 |
| 147,174 | 153,880 | 210,491 | 2,504 | 898,072 | 721,287 |
| 140,982 | 79,536 | 5,520 | 2,329 | 390,422 | 351,776 |
| 2,793,290 | 2,722,978 | 1,156,409 | 992,716 | 19,527,684 | 19,245,926 |
| 7,962,850 | 7,624,487 | (2,414) | – | 9,043,998 | 8,730,734 |
| 618,812 | 561,342 | – | – | 618,898 | 561,426 |
| 11,374,952 | 10,908,807 | 1,153,995 | 992,716 | 29,190,580 | 28,538,086 |
| 114,780 | 113,328 | (1,259) | – | 2,811,992 | 3,048,496 |
| 345,276 | 447,537 | – | – | 345,276 | 447,537 |
| 9,163 | 9,591 | – | – | 229,901 | 339,096 |
| 7,617 | 6,286 | – | – | 8,863 | 7,822 |
| 1,904,550 | 1,922,919 | – | – | 2,223,760 | 2,228,152 |
| 859,178 | 540,738 | – | – | 3,022,419 | 2,609,264 |
| 282,983 | 211,189 | (557,677) | (492,617) | 1,322,038 | 1,261,780 |
| – | – | – | – | – | 2,906,123 |
| 14,898,499 | 14,160,395 | 595,059 | 500,099 | 39,154,829 | 41,386,356 |
Segmentation of technical and other liabilities
| Figures in EUR thousand | Non-life reinsurance | |
|---|---|---|
| 2007 | 2006 | |
| 30.6. | 31.12. | |
| Liabilities | ||
| Loss and loss adjustment expense reserve | 16,195,785 | 16,268,479 |
| Benefit reserve | – | – |
| Unearned premium reserve | 1,555,774 | 1,540,154 |
| Provisions for contingent commissions | 171,820 | 159,699 |
| Funds held under reinsurance contracts | 235,452 | 437,407 |
| Contract deposits | 159,816 | 147,594 |
| Reinsurance payable | 621,265 | 1,012,468 |
| Long-term liabilities | 45,676 | 56,857 |
| Other liabilities in the segment | 1,853,818 | 1,638,633 |
| Liabilities related to assets held for sale | – | 2,478,513 |
| Total | 20,839,406 | 23,739,804 |
| Life and health reinsurance | Consolidation | Total | |||
|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 | 2007 | 2006 |
| 30.6. | 31.12. | 30.6. | 31.12. | 30.6. | 31.12. |
| 1,413,811 | 1,327,846 | (1,279) | – | 17,608,317 | 17,596,325 |
| 6,289,988 | 6,109,154 | – | – | 6,289,988 | 6,109,154 |
| 45,958 | 40,880 | – | – | 1,601,732 | 1,581,034 |
| 49,069 | 41,070 | – | – | 220,889 | 200,769 |
| 916,113 | 982,037 | (2,416) | – | 1,149,149 | 1,419,444 |
| 3,711,030 | 3,379,187 | – | – | 3,870,846 | 3,526,781 |
| 385,179 | 204,110 | (990) | (745) | 1,005,454 | 1,215,833 |
| – | – | 1,373,049 | 1,372,036 | 1,418,725 | 1,428,893 |
| 1,167,434 | 1,229,294 | (482,556) | (607,037) | 2,538,696 | 2,260,890 |
| – | – | – | 62,334 | – | 2,540,847 |
| 13,978,582 | 13,313,578 | 885,808 | 826,588 | 35,703,796 | 37,879,970 |
Segmental statement of income
| Figures in EUR thousand | Non-life reinsurance | |
|---|---|---|
| 2007 | 2006 | |
| 1.1.–30.6. | 1.1.–30.6. | |
| Gross written premium | 2,964,416 | 3,729,983 |
| thereof | ||
| From insurance business with other segments | – | – |
| From insurance business with external third parties and from discontinued operations |
2,964,416 | 3,729,983 |
| Net premium earned | 2,328,471 | 2,512,733 |
| Net investment income | 411,825 | 325,011 |
| Claims and claims expenses | 1,761,117 | 1,835,103 |
| Change in benefit reserves | – | – |
| Commission and brokerage, change in deferred acquisition costs and other technical income/expenses |
550,472 | 621,069 |
| Administrative expenses | 72,996 | 71,448 |
| Other income and expenses | (34,211) | (6,509) |
| Operating profit/loss (EBIT) | 321,500 | 303,615 |
| Interest on hybrid capital | – | – |
| Net income before taxes | 321,500 | 303,615 |
| Taxes | 73,066 | 75,183 |
| Net income from continuing operations | 248,434 | 228,432 |
| Net income from discontinued operations | 13,677 | 31,549 |
| Net income | 262,111 | 259,981 |
| thereof | ||
| Minority interest in profit and loss | 20,685 | 39,397 |
| Group net income | 241,426 | 220,584 |
| Life and health reinsurance | Consolidation | Total | |||
|---|---|---|---|---|---|
| 2007 | 2006 | 2007 | 2006 | 2007 | 2006 |
| 1.1.–30.6. | 1.1.–30.6. | 1.1.–30.6. | 1.1.–30.6. | 1.1.–30.6. | 1.1.–30.6. |
| 1,532,264 | 1,282,564 | (5,112) | – | 4,491,568 | 5,012,547 |
| 5,112 | – | (5,112) | – | – | – |
| 1,527,152 | 1,282,564 | – | – | 4,491,568 | 5,012,547 |
| 1,376,702 | 1,123,957 | – | – | 3,705,173 | 3,636,690 |
| 149,239 | 133,339 | 18,852 | 25,557 | 579,916 | 483,907 |
| 784,204 | 697,129 | (279) | (798) | 2,545,042 | 2,531,434 |
| 214,492 | 67,513 | – | – | 214,492 | 67,513 |
| 389,942 | 387,954 | (3,288) | (3,091) | 937,126 | 1,005,932 |
| 29,900 | 28,015 | (2,309) | (2,259) | 100,587 | 97,204 |
| 21,801 | 1,516 | (7,733) | (9,636) | (20,143) | (14,629) |
| 129,204 | 78,201 | 16,995 | 22,069 | 467,699 | 403,885 |
| – | – | 38,517 | 38,497 | 38,517 | 38,497 |
| 129,204 | 78,201 | (21,522) | (16,428) | 429,182 | 365,388 |
| 32,899 | 20,871 | 33,899 | (3,860) | 139,864 | 92,194 |
| 96,305 | 57,330 | (55,421) | (12,568) | 289,318 | 273,194 |
| – | – | 17,035 | (2,595) | 30,712 | 28,954 |
| 96,305 | 57,330 | (38,386) | (15,163) | 320,030 | 302,148 |
| 6,374 | 6,176 | – | – | 27,059 | 45,573 |
| 89,931 | 51,154 | (38,386) | (15,163) | 292,971 | 256,575 |
Our secondary segmental reporting covers the continuing operations and is based on the regional origin of the investments and gross written premium.
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 30.6. | 31.12. | |
| Total investments excluding cash | ||
| Germany | 6,129,737 | 5,873,843 |
| United Kingdom | 1,141,256 | 1,028,814 |
| France | 1,150,075 | 1,044,337 |
| Other | 2,817,785 | 2,836,679 |
| Europe | 11,238,853 | 10,783,673 |
| USA | 5,906,280 | 6,208,046 |
| Other | 557,502 | 536,015 |
| North America | 6,463,782 | 6,744,061 |
| Asia | 314,235 | 281,290 |
| Australia | 638,197 | 551,309 |
| Australasia | 952,432 | 832,599 |
| Africa | 307,891 | 291,548 |
| Other | 174,304 | 242,269 |
| Total | 19,137,262 | 18,894,150 |
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 1.1.–30.6. | 1.1.–30.6. | |
| Gross written premium | ||
| Germany | 839,150 | 842,458 |
| United Kingdom | 792,706 | 670,847 |
| France | 211,015 | 234,881 |
| Other | 616,596 | 613,939 |
| Europe | 2,459,467 | 2,362,125 |
| USA | 1,108,636 | 1,727,226 |
| Other | 202,473 | 196,276 |
| North America | 1,311,109 | 1,923,502 |
| Asia | 233,967 | 277,977 |
| Australia | 229,056 | 201,234 |
| Australasia | 463,023 | 479,211 |
| Africa | 128,449 | 132,961 |
| Other | 129,520 | 114,748 |
| Total | 4,491,568 | 5,012,547 |
1) After elimination of internal transactions within the Group across segments
The parent company Hannover Rückversicherung AG ("Hannover Re") and its subsidiaries (collectively referred to as the "Hannover Re Group") belong to Talanx AG, which in turn is wholly owned by HDI Haftpflichtverband der Deutschen Industrie V.a.G. (HDI). Hannover Re is obliged to prepare a consolidated financial statement and group management report in accordance with § 290 German Commercial Code (HGB). Furthermore, HDI is required by §§ 341 i et seq. German Commercial Code (HGB) to prepare consolidated annual accounts that include the annual financial statements of Hannover Re and its subsidiaries.
The consolidated financial statement of Hannover Re was drawn up in full compliance with the International Financial Reporting Standards (IFRS) that are to be used within the European Union. This also applies to all figures provided in this report for previous periods. Since 2002 the standards adopted by the International Accounting Standards Board (IASB) have been referred to as IFRS; the standards dating from earlier years still bear the name "International Accounting Standards (IAS)". Standards are cited in our Notes accordingly; unless the Notes make explicit reference to a particular standard, both terms are used synonymously.
The quarterly results of reinsurance enterprises, including those of Hannover Re, are for various reasons not a reliable indicator of the results for the financial year as a whole. Losses from natural disasters and other catastrophic losses impact the result of the reporting period in which they occur. Furthermore, belatedly reported claims for major loss events can also lead to substantial fluctuations in individual quarterly results. Gains and losses on the disposal of investments are accounted for in the quarter in which the investments are sold.
The quarterly accounts of the consolidated companies included in the consolidated financial statement were drawn up as at 30 June 2007.
All standards adopted by the IASB as at 30 June 2007 with binding effect for the reporting period have been observed in the consolidated financial statement.
In the present half-yearly financial report as at 30 June 2007 we have for the first time included a selfcontained, condensed risk report in the interim management report, to which we would hereby refer the reader. In combination with the outlook for the full 2007 financial year, the intention is to thereby further improve the reporting on major opportunities and risks in the financial year.
By taking these steps Hannover Re is also complying with the requirements of the Transparency Directive Implementing Act (TUG) in conjunction with § 37w Securities Trading Act (WpHG) for half-yearly financial reporting. Furthermore, from the first quarter of 2007 onwards we are reporting separately on major related party transactions. In addition to numerous provisions relating to publication and disclosure of the financial statement, the TUG recommends review of the half-yearly financial report by independent auditors, to whose review report we would refer the reader at the end of these Notes.
Effective 30 June 2007 management is for the first time required to submit a "responsibility statement" regarding the consolidated interim financial statement and interim management report. In this respect we have been guided by the wording standards contained in the draft of German Accounting Standard (GAS) No. 16 "Interim Financial Reporting" (cf. GAS 16.56). Please see here page 47 of the half-yearly financial report.
Following the sale of Praetorian Financial Group, Inc., New York, and with the aim of focusing on reinsurance business, we have divided our segmental reporting drawn up in accordance with the provisions of IAS 14 "Segment Reporting" into the business groups of non-life reinsurance and life and health reinsurance. Financial reinsurance – as part of the product range of non-life reinsurance – as well as the remaining portion of the specialty insurance business group are now reported together with and in the non-life reinsurance business group. The figures for the previous period shown for comparative purposes have been adjusted retrospectively.
The first-time adoption of new or modified IFRS will have a bearing on the Group annual financial report as at 31 December 2007 and will have the following implications: IFRS 7 "Financial Instruments: Disclosures", which is to be applied to financial years beginning on or after 1 January 2007, requires not only extended duties of disclosure with respect to the recognition of financial instruments but also more detailed explanations of the type and extent of the risks associated with such financial instruments. Following corresponding modification of IFRS 4 "Insurance Contracts" these provisions similarly apply to risks arising out of insurance contracts. The amendments of IAS 1 (rev. 2005) "Presentation of Financial Statements", which also apply to financial years beginning on or after 1 January 2007, require disclosures regarding the aims, methods and processes of capital management.
We would also refer to the relevant information in the consolidated financial statement as at 31 December 2006.
Effective 1 January 2007 Hannover Re completed a reorganisation of some of its Irish group companies with no effect on income within the Group. With the exception of specific reinsurance contracts, the business operations of E+S Reinsurance (Ireland) Ltd. and Hannover Reinsurance (Dublin) Ltd. were transferred by sale to Hannover Reinsurance (Ireland) Ltd. Since that date E+S Reinsurance (Ireland) Ltd. and Hannover Reinsurance (Dublin) Ltd. have been in run-off and are no longer writing new business.
The company Castellum Holdings Ltd. and its subsidiary Castellum Re Ltd. held by Hannover Re (Bermuda) Ltd., Hamilton, were liquidated effective 21 March 2007.
A capital reduction of EUR 27.4 million was implemented in the first quarter at WRH Offshore High Yield Partners, L.P., Wilmington, 70.0% of which is held by Hannover Re and 30.0% by E+S Rück, through the sale of part of the company's assets and payment of the sales proceeds to the shareholders.
On 11 April 2007 Hannover Rück Beteiligung Verwaltungs-GmbH (HRBV) acquired effective 1 April 2007 the 10% stake held by a minority shareholder, CiV Lebensversicherung AG, Hilden (CiV Leben), in E+S Rück AG for a purchase price of EUR 135.2 million. CiV Leben, a subsidiary of Talanx AG, is an affiliated company as defined by IAS 24. This increase in the share held in an already consolidated Group company with no change in control status constitutes a transaction between entities under common control. In accordance with the applicable requirements of IFRS 3 in conjunction with IAS 27 we dispensed with a revaluation of the net assets and recognised the difference between the purchase price of the acquired shares and the pro-rata assets at existing book values in an amount of EUR 6.8 million as goodwill.
The capital consolidation complies with the standards of IAS 27 "Consolidated and Separate Financial Statements". Subsidiaries are consolidated as soon as Hannover Re acquires a majority voting interest or de facto controlling influence. The capital consolidation is based on the revaluation method. Under the "purchase accounting" method the purchase costs of the parent company are netted with the proportionate shareholders' equity of the subsidiary at the time when it is first included in the consolidated financial statement after the revaluation of all assets and liabilities. After recognition of all acquired intangible assets that in accordance with IFRS 3 "Business Combinations" are to be accounted for separately from goodwill, the difference between the revalued shareholders' equity of the subsidiary and the purchase price is recognised as goodwill. Under IFRS 3 scheduled amortisation is not taken on goodwill. Instead, unscheduled amortisation is taken where necessary on the basis of regular impairment tests. Immaterial and negative goodwill are recognised in the statement of income in the year of their occurrence.
Companies over which Hannover Re is able to exercise a controlling influence ("associated companies") are normally consolidated "at equity" with the proportion of the shareholders' equity attributable to the Group. A controlling influence is presumed to exist if a company belonging to the Hannover Re Group directly or indirectly holds at least 20% – but no more than 50% – of the voting rights. Income from investments in associated companies is recognised separately in the consolidated statement of income.
Where minority interests in shareholders' equity exist, such interests are reported separately within Group shareholders' equity in accordance with IAS 1 "Presentation of Financial Statements".
The minority interest in the result is a component of net income and is shown separately as a "thereof" note following net income. As at 30 June 2007 it amounted to EUR 27.1 million (EUR 45.6 million).
Receivables and liabilities between the companies included in the consolidated financial statement were offset against each other.
The effects of business transactions within the Group were eliminated.
In the third quarter of the previous year, with the aim of transferring peak exposures deriving from natural disasters to the capital market, Hannover Re issued a catastrophe ("CAT") bond that can be traded on a secondary market – the first time it had used such a tool. The CAT bond with a volume of USD 150 million was placed with institutional investors from Europe and North America by a special purpose entity. Hannover Re does not exercise a controlling influence over the special purpose entity. Under IFRS this transaction is to be recognised as a financial instrument. In accordance with IAS 39.9 the contract constitutes a derivative, the fair value of which as at 30 June 2007 amounted to -EUR 3.4 million and which we carried under other liabilities as at the balance sheet date.
In January 2007 Hannover Re again drew on the capital market to obtain underwriting capacity for catastrophe risks by increasing the volume of last year's "K5" securitisation to EUR 394.5 million. Kaith Re Ltd., a special purpose entity domiciled in Bermuda, was used for the transaction, which was placed with investors in North America, Europe and Japan. The additional capital in the amount of EUR 80.4 million was provided by both new and existing investors. The planned term of the transaction runs until 31 December 2008. Pursuant to SIC–12 Kaith Re Ltd. has been included in the consolidated financial statements since 1 January 2006.
In February 2007 the Hannover Re Group transferred for the first time risks resulting from reinsurance recoverables to the capital market. This securitisation enables Hannover Re to reduce the default risk associated with reinsurance recoverables. The portfolio of receivables underlying the transaction has a nominal value of approximately EUR 1.0 billion and consists of exposures to insurers and reinsurers. The securities serving as collateral were issued via a special purpose entity. Payment to Hannover Re – after allowance for its deductible – is triggered by a retrocessionaire's insolvency. Hannover Re does not bear the majority of the economic benefits or risks arising out of the special purpose entity's activities through any of its business relations. In accordance with IAS 39.9 the transaction constitutes a derivative, the fair value of which as at 30 June 2007 amounted to -EUR 20 thousand and which we carried under other liabilities as at the balance sheet date.
In March 2007, with the aim of better protecting its balance sheet and further extending its access to the retrocession market, Hannover Re placed on the capital market a protection cover on its worldwide natural catastrophe business in an amount of EUR 150.4 million with a term of two years. A risk carrier in the form of a special purpose entity provides Hannover Re with aggregate excess of loss coverage. The underlying portfolio consists of the natural catastrophe business retained under the existing "K5" securitisation. The cover attaches upon occurrence of an aggregated 83-year-event for "K5" and is fully utilised upon occurrence of a 250-year accumulation. Within this spread the outside investors assume 90% of the modelled "K5" losses, while the remaining 10% remain with Hannover Re. Hannover Re does not bear the majority of the economic benefits or risks arising out of this company's activities through any of its business relations with the special purpose entity.
In the previous year Hannover Re reached agreement on the sale of its American subgroup Praetorian Financial Group, Inc., New York (PFG), to an Australian insurance group. Effective 31 May 2007 beneficial ownership of the assets and liabilities belonging to the subgroup classified in the previous periods as discontinued operations was transferred. They were therefore no longer recognised as at the balance sheet date. In accordance with the structure of the transaction, both the provisional purchase price of USD 805.9 million and the provisional disposal gain are subject to the final determination that is to be made in the fourth quarter of 2007. In compliance with IFRS 5 "Non-current Assets Held for Sale and Discontinued Operations", we recognise the profit or loss of PFG in the Group statement of income for all presented periods after tax in a separate line. For further explanatory remarks please see the corresponding information in the consolidated financial statement as at 31 December 2006.
The profit or loss and net cash flows of the discontinued operations are presented in the following tables and broken down into their major components. The reported half-yearly figures only cover transactions until the deconsolidation date of 31 May 2007.
| 1.1.–30.6. 1.1.–30.6. |
|
|---|---|
| Gross written premium 280,948 1,284,351 |
|
| Ceded written premium (42,885) 666,385 |
|
| Net change in gross unearned premium (14,725) (209,282) |
|
| Net premium earned 309,108 408,684 |
|
| Net investment income 20,696 10,663 |
|
| Net underwriting result 25,175 36,048 |
|
| Other income and expenses (11,345) |
(790) |
| Operating profit/loss (EBIT) 34,526 45,921 |
|
| Interest on hybrid capital 2,358 |
2,650 |
| Net income before taxes 32,168 43,271 |
|
| Taxes 5,868 14,317 |
|
| Acquirer's share of current income from discontinued operations 13,251 |
– |
| Group share of current income from discontinued operations 13,049 28,954 |
|
| Income/loss from deconsolidation (after taxes) 17,663 |
– |
| Net income 30,712 28,954 |
Major items in the statement of income of the discontinued operations
As at 30 June 2007 the net income recognised from the discontinued operations includes a provisional disposal gain of EUR 17.7 million after taxes and less costs to sell. The tax expenditure attributable to this disposal gain amounts to EUR 69.4 million. Pursuant to the purchase agreement these amounts will be finally adjusted in the fourth quarter of 2007.
Statement of cash flows from the discontinued operations
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 1.1.–30.6. | 1.1.–30.6. | |
| Cash flow from operating activities | 178,464 | 196,750 |
| Cash flow from investing activities | (18,716) | (376,771) |
| Cash flow from financing activities | – | 152,021 |
| Change in cash and cash equivalents | 159,748 | (28,000) |
Investments are classified and measured in accordance with IAS 39 "Financial Instruments: Recognition and Measurement". Hannover Re Group classifies investments according to the following categories: held to maturity, loans and receivables, financial assets at fair value through profit or loss, held for trading and available for sale. The allocation and measurement of investments are determined by the investment intent.
Fixed-income securities classified as held to maturity as well as loans and receivables originated by the entity that are not listed on an active market or sold at short notice are measured at purchase cost – i. e. fair value as at purchase date including directly allocable transaction costs – plus amortised cost. The amortised cost derives from the difference between the nominal value and purchase cost and they are spread over the time to maturity of the fixed-income securities.
Fixed-income securities classified as available for sale are measured at fair value. The difference between the fair value and amortised cost is recognised outside the statement of income until realisation.
Financial assets at fair value through profit or loss and securities held for trading are measured at fair value. The difference between the fair value and amortised cost is recognised in the statement of income.
Securities whose fair value falls significantly or permanently below purchase cost are written down to current value and recognised in the statement of income.
The investments also include investments in associated companies, real estate used by third parties, shortterm investments, cash and funds held. The other investments primarily consist of shares in private equity limited partnerships.
For further details we would refer to the relevant information in the consolidated financial statement as at 31 December 2006.
| Figures in EUR thousand | 2007 | 2006 | |||
|---|---|---|---|---|---|
| Cost or amortised cost |
Fair value | Cost or amortised cost |
Fair value | ||
| 30.6. | 30.6. | 31.12. | 31.12. | ||
| Held to maturity | |||||
| due in one year | 40,594 | 44,119 | 66,775 | 66,892 | |
| due after one through two years | 20,540 | 20,166 | 27,742 | 27,295 | |
| due after two through three years | 22,196 | 21,984 | – | – | |
| due after three through four years | 133,017 | 131,453 | 21,615 | 21,749 | |
| due after four through five years | 243,489 | 238,916 | 203,263 | 204,026 | |
| due after five through ten years | 1,083,139 | 1,056,331 | 1,271,484 | 1,281,502 | |
| due after ten years | 10,990 | 10,744 | 11,178 | 11,357 | |
| Total | 1,553,965 | 1,523,713 | 1,602,057 | 1,612,821 | |
| Loans and receivables | |||||
| due in one year | 18,616 | 18,744 | 27,992 | 28,147 | |
| due after one through two years | 49,967 | 49,271 | 24,774 | 25,347 | |
| due after two through three years | 158,452 | 152,228 | 62,218 | 60,628 | |
| due after three through four years | 55,107 | 52,399 | 123,217 | 119,212 | |
| due after four through five years | 57,478 | 53,871 | 91,335 | 87,326 | |
| due after five through ten years | 857,192 | 809,015 | 554,829 | 534,798 | |
| due after ten years | 30,489 | 29,452 | 31,228 | 31,213 | |
| Total | 1,227,301 | 1,164,980 | 915,593 | 886,671 | |
| Available for sale | |||||
| due in one year | 1,430,184 | 1,410,170 | 1,381,230 | 1,380,347 | |
| due after one through two years | 1,530,377 | 1,518,188 | 1,700,790 | 1,692,481 | |
| due after two through three years | 1,293,948 | 1,266,799 | 1,678,241 | 1,637,918 | |
| due after three through four years | 1,272,395 | 1,244,935 | 1,566,342 | 1,562,701 | |
| due after four through five years | 1,131,919 | 1,114,072 | 1,187,735 | 1,176,674 | |
| due after five through ten years | 4,519,760 | 4,367,729 | 4,543,454 | 4,472,663 | |
| due after ten years | 1,815,358 | 1,774,882 | 1,123,275 | 1,139,366 | |
| Total | 12,993,941 | 12,696,775 | 13,181,067 | 13,062,150 | |
| Financial assets at fair value through profit or loss |
|||||
| due in one year | 101,689 | 101,689 | 102,378 | 102,482 | |
| due after one through two years | 356 | 553 | 895 | 1,224 | |
| due after two through three years | – | – | – | – | |
| due after three through four years | – | – | – | – | |
| due after four through five years | 1,382 | 1,676 | – | – | |
| due after five through ten years | 33,130 | 33,195 | 31,840 | 31,928 | |
| due after ten years | 25,302 | 27,761 | 27,411 | 30,829 | |
| Total | 161,859 | 164,874 | 162,524 | 166,463 |
The stated maturities may in individual cases diverge from the contractual maturities because borrowers may have the right to call or prepay obligations with or without penalty.
Floating-rate bonds (also known as "floaters") are shown under the maturities due in one year and constitute our interest-related, within-the-year reinvestment risk.
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments classified as held to maturity as well as their fair value
| 30.6.2007 | |||||
|---|---|---|---|---|---|
| Figures in EUR thousand | Cost or amortised cost |
Unrealised gains |
losses | Accrued interest |
Fair value |
| Investments held to maturity | |||||
| Fixed-income securities | |||||
| Government debt securities of EU | |||||
| member states | 52,793 | – | 3,576 | 1,044 | 50,261 |
| US treasury notes | 350,834 | – | 2,395 | 2,842 | 351,281 |
| Other foreign government debt securities | 7,139 | – | 140 | 26 | 7,025 |
| Debt securities issued by | |||||
| semi-governmental entities | 444,624 | 2,188 | 6,730 | 6,808 | 446,890 |
| Corporate securities | 432,068 | 1,256 | 9,507 | 14,320 | 438,137 |
| Asset-backed securities | 237,516 | 22 | 11,370 | 3,951 | 230,119 |
| Total | 1,524,974 | 3,466 | 33,718 | 28,991 | 1,523,713 |
| 31.12.2006 | |||||
|---|---|---|---|---|---|
| Figures in EUR thousand | Cost or amortised cost |
Unrealised gains |
losses | Accrued interest |
Fair value |
| Investments held to maturity | |||||
| Fixed-income securities | |||||
| Government debt securities of EU member states |
52,922 | – | 1,355 | 813 | 52,380 |
| US treasury notes | 358,281 | 4,455 | – | 2,942 | 365,678 |
| Other foreign government debt securities | 6,648 | 84 | – | 25 | 6,757 |
| Debt securities issued by semi-governmental entities |
455,039 | 8,305 | 1,709 | 9,402 | 471,037 |
| Corporate securities | 446,116 | 7,290 | 3,150 | 11,536 | 461,792 |
| Asset-backed securities | 252,169 | 90 | 3,246 | 6,164 | 255,177 |
| Total | 1,571,175 | 20,224 | 9,460 | 30,882 | 1,612,821 |
| 30.6.2007 | |||||
|---|---|---|---|---|---|
| Figures in EUR thousand | Cost or amortised cost |
Unrealised gains |
losses | Accrued interest |
Fair value |
| Loans and receivables | |||||
| Government debt securities of EU member states |
19,977 | – | 1,279 | 23 | 18,721 |
| Debt securities issued by | |||||
| semi-governmental entities | 260,380 | 349 | 15,073 | 3,633 | 249,289 |
| Corporate securities | 483,638 | 485 | 24,429 | 9,889 | 469,583 |
| Asset-backed securities | 441,287 | 268 | 22,642 | 8,474 | 427,387 |
| Total | 1,205,282 | 1,102 | 63,423 | 22,019 | 1,164,980 |
| Figures in EUR thousand | Cost or amortised cost |
Unrealised gains |
losses | Accrued interest |
Fair value |
|---|---|---|---|---|---|
| Loans and receivables | |||||
| Government debt securities of EU member states |
19,979 | – | 468 | 168 | 19,679 |
| Debt securities issued by semi-governmental entities |
220,901 | 191 | 9,471 | 2,755 | 214,376 |
| Corporate securities | 368,929 | 989 | 11,325 | 5,435 | 364,028 |
| Asset-backed securities | 293,129 | 1,173 | 10,011 | 4,297 | 288,588 |
| Total | 902,938 | 2,353 | 31,275 | 12,655 | 886,671 |
| 30.6.2007 | |||||
|---|---|---|---|---|---|
| Figures in EUR thousand | Cost or amortised cost |
gains | Unrealised losses |
Accrued interest |
Fair value |
| Available for sale | |||||
| Fixed-income securities | |||||
| Government debt securities of EU member states |
757,968 | 306 | 21,538 | 13,894 | 750,630 |
| US treasury notes | 1,726,743 | 1,011 | 34,492 | 22,434 | 1,715,696 |
| Other foreign government debt securities | 320,334 | 965 | 2,535 | 2,397 | 321,161 |
| Debt securities of semi governmental entities |
3,475,461 | 6,320 | 82,339 | 53,481 | 3,452,923 |
| Corporate securities | 3,534,472 | 17,338 | 108,501 | 60,352 | 3,503,661 |
| Asset-backed securities | 2,171,026 | 7,516 | 62,242 | 27,266 | 2,143,566 |
| Investment funds | 816,827 | 20,082 | 39,057 | 11,286 | 809,138 |
| 12,802,831 | 53,538 | 350,704 | 191,110 | 12,696,775 | |
| Equity securities | |||||
| Shares | 382,912 | 97,308 | 4,542 | – | 475,678 |
| Investment funds | 1,038,834 | 216,452 | 1,946 | – | 1,253,340 |
| 1,421,746 | 313,760 | 6,488 | – | 1,729,018 | |
| Short-term investments | 897,162 | – | – | 910 | 898,072 |
| Total | 15,121,739 | 367,298 | 357,192 | 192,020 | 15,323,865 |
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments classified as available for sale as well as their fair value
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments classified as available for sale as well as their fair value
| 31.12.2006 | |||||
|---|---|---|---|---|---|
| Figures in EUR thousand | Cost or amortised cost |
gains | Unrealised losses |
Accrued interest |
Fair value |
| Available for sale | |||||
| Fixed-income securities | |||||
| Government debt securities of EU member states |
980,946 | 1,747 | 12,241 | 15,982 | 986,434 |
| US treasury notes | 1,899,898 | 3,215 | 25,662 | 22,933 | 1,900,384 |
| Other foreign government debt securities | 289,217 | 608 | 1,780 | 2,068 | 290,113 |
| Debt securities of semi governmental entities |
3,360,131 | 11,949 | 47,231 | 50,403 | 3,375,252 |
| Corporate securities | 3,801,556 | 27,667 | 64,041 | 72,280 | 3,837,462 |
| Asset-backed securities | 1,864,670 | 12,471 | 27,381 | 25,539 | 1,875,299 |
| Investment funds | 784,131 | 17,234 | 15,472 | 11,313 | 797,206 |
| 12,980,549 | 74,891 | 193,808 | 200,518 | 13,062,150 | |
| Equity securities | |||||
| Shares | 428,788 | 76,980 | 2,491 | – | 503,277 |
| Investment funds | 944,959 | 138,076 | 241 | – | 1,082,794 |
| 1,373,747 | 215,056 | 2,732 | – | 1,586,071 | |
| Short-term investments | 720,482 | – | – | 805 | 721,287 |
| Total | 15,074,778 | 289,947 | 196,540 | 201,323 | 15,369,508 |
| 30.6.2007 | |||
|---|---|---|---|
| Figures in EUR thousand | Fair value before accrued interest |
Accrued interest |
Fair value |
| Financial assets at fair value through profit or loss |
|||
| Debt securities of semi-governmental entities |
9,740 | 131 | 9,871 |
| Corporate securities | 152,641 | 712 | 153,353 |
| Asset-backed securities | 1,650 | – | 1,650 |
| 164,031 | 843 | 164,874 | |
| Other financial assets | |||
| Derivative financial instruments | 19,590 | – | 19,590 |
| Total | 183,621 | 843 | 184,464 |
Fair value of financial assets at fair value through profit or loss before and after accrued interest as well as accrued interest on such financial assets
| 31.12.2006 | |||
|---|---|---|---|
| Figures in EUR thousand | Fair value before accrued interest |
Accrued interest |
Fair value |
| Financial assets at fair value through profit or loss |
|||
| Debt securities of semi-governmental entities |
9,488 | 231 | 9,719 |
| Corporate securities | 150,611 | 1,683 | 152,294 |
| Asset-backed securities | 4,431 | 19 | 4,450 |
| 164,530 | 1,933 | 166,463 | |
| Equity securities | |||
| Investment funds | 10,207 | – | 10,207 |
| Other financial assets | |||
| Derivative financial instruments | – | – | – |
| Total | 197,105 | 1,933 | 199,038 |
As at 30 June 2007 Hannover Re is reporting as financial assets at fair value through profit or loss technical derivatives previously recognised in the trading portfolio in an amount of EUR 19.6 million (31 December 2006: EUR 22.4 million) that were separated from the underlying transaction and measured at fair value. The figures for the corresponding period of the previous year have been adjusted accordingly retrospectively.
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 30.6. | 30.6. | |
| Real estate | 932 | 11,617 |
| Dividends | 23,414 | 20,111 |
| Interest income on investments | 367,986 | 338,379 |
| Other income | 17,133 | 15,041 |
| Ordinary investment income | 409,465 | 385,148 |
| Profit or loss on shares in associated companies | 3,473 | 1,192 |
| Realised gains on investments | 134,320 | 49,870 |
| Realised losses on investments | 36,737 | 37,976 |
| Unrealised gains and losses | (141) | 10,207 |
| Impairments/depreciation on real estate | 278 | 2,906 |
| Impairments on equity securities | 339 | 5,450 |
| Impairments on participating interests and other financial assets | – | 2,841 |
| Other investment expenses | 27,798 | 25,758 |
| Net income from assets under own management | 481,965 | 371,486 |
| Interest income on funds withheld and contract deposits | 118,966 | 133,164 |
| Interest expense on funds withheld and contract deposits | 21,015 | 20,743 |
| Total investment income | 579,916 | 483,907 |
| Figures in EUR thousand | 2007 | 2006 |
|---|---|---|
| 30.6. | 30.6. | |
| Fixed-income securities – held to maturity | 33,630 | 33,107 |
| Fixed-income securities – loans and receivables | 28,214 | 13,729 |
| Fixed-income securities – available for sale | 278,221 | 270,014 |
| Financial assets – at fair value through profit or loss | 3,304 | 2,060 |
| Other | 24,617 | 19,469 |
| Total | 367,986 | 338,379 |
The average number of staff at the companies included in the consolidated financial statement of the Hannover Re Group was 1,977 (31 December 2006: 1,988). Of this number, 888 were employed in Germany in the reporting period and 1,090 were employed at the consolidated Group companies abroad; as at the balance sheet date the discontinued operations accounted for 249 staff. Following its disposal in the second quarter they are no longer included in the staff numbers.
Shareholders' equity is shown as a separate component of the financial statement in accordance with IAS 1 "Presentation of Financial Statements" and subject to IAS 32 "Financial Instruments: Disclosure and Presentation" in conjunction with IAS 39 "Financial Instruments: Recognition and Measurement". The change in shareholders' equity comprises not only the net income deriving from the statement of income but also the changes in the value of asset and liability items not recognised in the statement of income.
The shareholders' equity (share capital of the parent company) amounts to EUR 120,597,134.00. It is divided into 120,597,134 voting and dividend-bearing registered no-par-value shares. The shares are paid in in full.
Minority interests are established in accordance with the shares held by companies outside the Group in the shareholders' equity of the subsidiaries.
Authorised capital of up to EUR 60,299 thousand is available with a time limit of 31 May 2009.
New individual registered shares may be issued on one or more occasions for contributions in cash or kind. Of the total amount, up to EUR 1,000 thousand may be used to issue employee shares.
In addition, conditional capital of up to EUR 60,299 thousand is available. It can be used to grant shares to holders of convertible bonds and bonds with warrants as well as to holders of profit-sharing rights or participating bonds with conversion rights and warrants and has a time limit of 11 May 2011.
IAS 1 requires separate disclosure of treasury shares in shareholders' equity. By a resolution of the Annual General Meeting of Hannover Rückversicherung AG adopted on 3 May 2007, the company was authorised until 31 October 2008 to acquire treasury shares of up to 10% of the share capital existing on the date of the resolution. The company did not hold treasury shares at any time during the reporting period.
Basic and diluted earnings per share
| 2007 | 2006 | |||||
|---|---|---|---|---|---|---|
| 1.1.–30.6. | ||||||
| 1.1.–30.6. | ||||||
| Result (in EUR | No. of | Per share | Result (in EUR | No. of | Per share | |
| thousand) | shares | (in EUR) | thousand) | shares | (in EUR) | |
| Group net income | ||||||
| Weighted average of issued shares | 120,597,134 | 120,597,134 | ||||
| Earnings per share | 292,971 | 120,597,134 | 2.43 | 256,575 | 120,597,134 | 2.13 |
| from continuing operations | 262,259 | 120,597,134 | 2.18 | 227,621 | 120,597,134 | 1.89 |
| from discontinued operations | 30,712 | 120,597,134 | 0.25 | 28,954 | 120,597,134 | 0.24 |
IAS 24 defines related parties inter alia as parent companies and subsidiaries, subsidiaries of a common parent company, associated companies, legal entities under the influence of management and the management of the company itself. In the year under review the following significant business relations existed with related parties.
HDI Haftpflichtverband der Deutschen Industrie V.a.G. (HDI) indirectly holds a majority interest in Hannover Re through the subsidiaries Talanx AG, HDI Verwaltungs-Service AG and Zweite HDI Beteiligungsgesellschaft mbH, all based in Hannover.
The Hannover Re Group provides reinsurance protection for the HDI Group. To this extent, numerous underwriting business relations exist with related parties in Germany and abroad which are not included in Hannover Re's consolidation. This includes business both assumed and ceded at usual market conditions.
The major reinsurance relationships with related parties in the year under review are listed in the following table.
| Figures in EUR thousand | 2007 | ||
|---|---|---|---|
| Related parties | Premium | Underwriting result |
|
| Business assumed | |||
| ASPECTA Assurance International AG | 10,285 | 1,739 | |
| ASPECTA Assurance International Luxembourg S.A. | 15,739 | 1,825 | |
| ASPECTA Lebensversicherung AG | 72,727 | 2,463 | |
| ASPECTA Versicherung AG | 8,824 | (4,294) | |
| CiV Lebensversicherung AG | 24,126 | 424 | |
| CiV Versicherung AG | 9,115 | 1,198 | |
| Gerling Konzern Allgemeine Versicherungs-AG | 79,981 | (8,643) | |
| HDI Asecuracja Towarzystwo Ubezpieczen S.A. | 8,468 | (431) | |
| HDI Assicurazioni S.p.A. | 6,436 | 2,627 | |
| HDI Gerling Lebensversicherung AG | 7,575 | (1,832) | |
| HDI Gerling Verzekeringen N.V. | 13,212 | 3,732 | |
| HDI HANNOVER International España, Cia. de Seguros y Reaseguros S.A. | 8,223 | 1,243 | |
| HDI Hannover Versicherung AG | 7,840 | 2,771 | |
| HDI Industrie Versicherung AG | 67,545 | (15,678) | |
| HDI Sigorta A.S. | 7,281 | (7,164) | |
| Magyar Posta Biztositó Részvénytársaság | 5,104 | (533) | |
| PB Lebensversicherung AG | 18,614 | (404) | |
| PB Versicherung AG | 2,698 | (256) | |
| Other companies | 3,114 | 1,881 | |
| Total | 376,907 | (19,332) | |
| Business ceded | |||
| HDI Industrie Versicherung AG | (601) | (210) | |
| Other companies | (21) | (29) | |
| Total | (622) | (239) |
Business assumed and ceded in Germany and abroad
With effect from the 1997 financial year onwards all new business and renewals written on the German market have been the responsibility of E+S Rück, while Hannover Re has handled foreign markets. Internal retrocession arrangements ensure that the percentage breakdown of the business applicable to the previously existing underwriting partnership is largely preserved between these companies.
Within the contractually agreed framework AmpegaGerling Asset Management GmbH performs investment and asset management services for Hannover Re and some of its subsidiaries. Assets in special funds are managed by AmpegaGerling Investment GmbH. AmpegaGerling Immobilien Management GmbH performs services for Hannover Re within the framework of a management contract.
Companies belonging to the Talanx Group granted the Hannover Re Group insurance protection inter alia in the areas of public liability, fire, group accident and business travel collision insurance. Divisions of Talanx AG also performed services for us in the area of general administration. All transactions were effected at usual market conditions.
With regard to the acquisition of the 10% stake held by CiV Lebensversicherung AG, a subsidiary of Talanx AG, in E+S Rück AG by Hannover Rück Beteiligung Verwaltungs-GmbH, please see our remarks in Section 3 "Consolidated companies and consolidation principles".
Hannover Re has secured by subordinated guarantee a subordinated debt in the amount of USD 400.0 million issued in the 1999 financial year by Hannover Finance, Inc., Wilmington/USA. In February 2004 and May 2005 Hannover Re bought back portions of the subordinated debt in amounts of USD 370.0 million and USD 10.0 million respectively, leaving an amount of USD 20.0 million still secured by the guarantee. Effective 4 June 2007 the issuer bought back the debt from Hannover Re in an amount of USD 380.0 million for the purpose of cancelling the debt. The cancellation process had not been completed as at the balance sheet date.
Hannover Re has placed three subordinated debts on the European capital markets through its subsidiary Hannover Finance (Luxembourg) S.A. Hannover Re has secured by subordinated guarantee both the debt issued in 2001, the volume of which now stands at EUR 138.1 million, and the debts from financial years 2004 and 2005 in amounts of EUR 750.0 million and EUR 500.0 million respectively. For further details we would refer to the relevant information in the consolidated financial statement as at 31 December 2006.
The guarantees given by Hannover Re for the subordinated debts attach if the issuer in question fails to render payments due under the bonds. The guarantees cover the relevant bond volumes as well as interest due until the repayment dates. Given the fact that interest on the bonds is partly dependent on the capital market rates applicable at the interest payment dates (floating rates), the maximum undiscounted amounts that can be called cannot be estimated with sufficient accuracy. Hannover Re does not have any rights of recourse outside the Group with respect to the guarantee payments.
In July 2004 Hannover Re and the other shareholders sold the participation that they held through Willy Vogel Beteiligungsgesellschaft mbH in Willy Vogel AG. In order to secure the guarantees assumed under the purchase agreement, Hannover Re and the other shareholders jointly gave the purchaser a directly enforceable guarantee for a period until 2009 limited to a total amount of EUR 7.1 million. Furthermore, in the event of a call being made on the guarantee Hannover Re and the other shareholders agreed that settlement would be based upon the ratio of participatory interests.
As security for technical liabilities to our US clients, we have established a master trust in the USA. As at the balance sheet date this master trust amounted to EUR 2,178.0 million (31 December 2006: EUR 2,238.8 million). The securities held in the master trust are shown as available-for-sale investments.
As security for our technical liabilities, various financial institutions have furnished sureties for our company in the form of letters of credit. The total amount of the letters of credit as at the balance sheet date was EUR 2,448.8 million (31 December 2006: EUR 2,684.2 million).
Outstanding capital commitments with respect to special investments exist in the amount of EUR 85.3 million (31 December 2006: EUR 91.3 million) for E+S Rück AG and EUR 189.7 million (31 December 2006: EUR 155.0 million) for Hannover Re. These involve primarily private equity funds and venture capital firms.
Within the scope of a novation agreement regarding a life insurance contract we assumed contingent reinsurance commitments with respect to due date and amount. The financing phase was terminated effective 31 December 2004 as per the agreement. The level of Hannover Re's liability as at the date of novation (31 December 2011) in relation to future balance sheet dates may change due to fluctuations in the EURIBOR and discrepancies between the actual settlements and the projections. As at the balance sheet date the estimated amount of the reinsurance commitments remained unchanged at EUR 33.4 million.
Effective 1 July 2007 Hannover Rück Beteiligung Verwaltungs-GmbH (HRBV) sold 2% of its stake in E+S Rück AG to an outside third party by way of a share reduction in a consolidated Group company without a change of control status. Additional paid-in capital of HRBV was released in the amount of the purchase price by a partners' resolution dated 26 June 2007 and transferred to Hannover Re as the sole shareholder of HRBV.
In a press release dated 5 July 2007 we announced the opening of a branch office in the Kingdom of Bahrain in addition to the already existing subsidiary Hannover ReTakaful B.S.C. (c), which was established in 2006. Hannover Rückversicherung AG, Bahrain Branch, is expected to commence business operations on 1 January 2008, having received the required licence from the Central Bank of Bahrain (CBB) in June 2007.
To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the interim consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group, and the interim management report of the Group includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal opportunities and risks associated with the expected development of the Group for the remaining months of the financial year.
Hannover, 27 July 2007
Executive Board
Zeller Arrago Dr. Becke
Gräber Dr. König Dr. Pickel Wallin
to Hannover Rückversicherung AG, Hannover
We have reviewed the condensed consolidated interim financial statements – comprising the balance sheet, income statement, cash flow statement, statement of changes in shareholders' equity and selected explanatory notes – together with the interim Group management report of Hannover Rückversicherung AG, Hannover, for the period from 1 January to 30 June 2007, which are components of the half-yearly financial report pursuant to § 37w of the German Securities Trading Act (WpHG). The preparation of the condensed consolidated interim financial statements in accordance with the IFRS applicable to interim financial reporting as adopted by the EU and of the interim management report for the Group in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports is the responsibility of the parent company's Board of Management. Our responsibility is to issue a review report on the condensed consolidated interim financial statements and on the interim management report for the Group based on our review.
We conducted our review of the condensed consolidated interim financial statements and the interim management report for the Group in accordance with German generally accepted standards for the review of financial statements promulgated by the Institute of Public Auditors in Germany (Institut der Wirtschaftsprüfer – IDW). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with moderate assurance, that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU and that the interim management report for the Group has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports. A review is limited primarily to inquiries of company personnel and analytical procedures and thus provides less assurance than an audit. Since, in accordance with our mandate, we have not performed a financial statement audit, we cannot express an audit opinion.
Based on our review, no matters have come to our attention that cause us to presume that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU or that the interim management report for the Group has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports.
Hannover, 1 August 2007
KPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft
Dr. Dahl Schuster Wirtschaftsprüfer Wirtschaftsprüfer
Karl-Wiechert-Allee 50 30625 Hannover Germany Telephone +49/5 11/56 04-0 Fax +49/5 11/56 04-11 88 [email protected]
www.hannover-re.com
Stefan Schulz
Telephone +49/5 11/56 04-15 00 Fax +49/5 11/56 04-16 48 [email protected]
Gabriele Bödeker
Telephone +49/5 11/56 04-17 36 Fax +49/5 11/56 04-16 48 [email protected]
Gabriele Handrick
Telephone +49/5 11/56 04-15 02 Fax +49/5 11/56 04-16 48 [email protected]
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