SCOR SE, France’s largest reinsurer, expects gross premiums to rise as much as 7 percent annually over the next three years on increased demand in Asia.
SCOR has “significant growth potential” despite a challenging and uncertain environment for interest rates and global economic growth, Chief Executive Officer Denis Kessler said on a call with journalists. The Paris-based company may consider share buybacks or exceptional dividends if SCOR achieves its solvency-ratio target, he said.
The premiums target, through mid-2019, is part of a new initiative SCOR announced in a statement on Wednesday. Revenue at SCOR’s life-reinsurance division is expected to increase by 5 percent to 6 percent each year. The unit is targeting 1.7 billion euros of premiums in Asia-Pacific in 2019, up from 1.1 billion euros this year, SCOR said
SCOR rose as much as 1.7 percent in Paris trading and was up 2.2 percent at 27.43 euros at 12:37 p.m. The shares have lost 21 percent in 2016, while the 32-member Bloomberg Europe 500 Insurance Index has dropped 16 percent.
SCOR set a return-on-equity target of at least 800 basis points over 5-year risk-free rates, a formula that would produce an ROE of 8.8 percent for the first half, the company said. Based on current rates, SCOR’s new ROE target is 130 basis points lower than its previous goal, Goldman Sachs analysts wrote in a note.
SCOR maintained a target for a solvency ratio of between 185 percent and 220 percent. SCOR shareholders will vote on a plan to extend Kessler’s mandate by four years at a meeting in April.
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