Munich Re profits up 10 percent

Few disaster losses, better investment result boost earning at Munich Re

Associated Press

FRANKFURT, Germany (AP) -- Reinsurer Munich Re says second quarter profit improved 10 percent from a year ago thanks to a better investment result and fewer expenses for natural disasters.

Net profit rose to €812 million ($1.0 billion) from €738 million in the second quarter last year. Gross premiums rose 5.5 percent to €12.63 billion.

The company benefited from not having to write down Greek government bonds, which cost it €125 million in the year ago quarter. That quarter's earnings were also burdened by claims for tornados in the United States.

CEO Nikolaus von Bomhard said Tuesday that the current low level of interest rates was a hazard for its business — "far greater than the volatility of markets or the worsened global economy." It invests much of its premium income in interest-bearing securities.

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