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Munich Re Sees Profit Growth In FY19, FY20; Plans Addl. EUR 1 Bln Buyback

German reinsurer Munich Re (0KFE.L) announced Wednesday that it expects profits for 2019 and 2020 will continue to rise following the significant increase in profit last year.

The company projects an increase of 200 million euros in fiscal 2019 profit to around 2.5 billion euros. The company expects to reach medium-term profit guidance of 2.8 billion euros in 2020.

Munich Re further said its good result in 2018 and the planned improvements in earnings power for 2019 allow it to propose to the Annual General Meeting a significant increase in the dividend to 9.25 euros, as well as to launch a further share buy-back programme with a volume of 1 billion euros.

In the expected profit for 2019, around 2.1 billion euros is attributable to reinsurance and around 0.4 billion euros to ERGO.

Following positive developments in the past year, the expected technical result for life and health reinsurance has been raised to around 500 million euros. In property-casualty reinsurance, Munich Re is aiming for an improved combined ratio of around 98% in 2019.

Munich Re expects an investment result of around 6.5 billion euros for 2019, representing a return on investments of about 3%.

Munich Re anticipates gross premiums written of around 49 billion euros in the 2019 financial year, comprising gross premium of around 31 billion euros in the reinsurance field of business and approximately 17.5 billion euros in the ERGO field of business.

Total premium income in the ERGO field of business, including the savings premiums of unit-linked life insurance and capitalisation products, should amount to around 18.5 billion euros in 2019.

Further, the company announced that Nikolaus von Bomhard is being nominated for election to the Supervisory Board at the Annual General Meeting. If elected by the Annual General Meeting, Nikolaus von Bomhard is also recommended to succeed Bernd Pischetsrieder as Chairman of the Supervisory Board.

The Supervisory Board is also nominating Karl-Heinz Streibich for first-time election to the Supervisory Board.

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