Swiss Re AG

Good morning or good afternoon. Welcome to the Swiss Reef 9 Months 2023 Results Conference Call. Please note that today's conference call is being recorded. At this time, I would like to turn the conference over to John Dacey, Group CFO. Please go ahead.

Thank you and good morning or good afternoon to everyone on the call. I'm here with Thomas Bowen, our Head of Investor Relations, to talk you through the 9 Months 2023 results. Before we go to Q&A, allow me to make a few quick remarks on the release that we put out this morning. We're reporting solid results today for the first nine months with a profit of $2.5 billion. We're on track to achieve the full-year target of more than $3 billion of net income. All businesses contributed to a strong third quarter. P&C REIT's third quarter combined ratio of 93.7%, absorbed $421 million of large NACCAT losses related to various events and a busy NACCAT quarter for the industry. We added significant amounts of assumption-driven reserves, therefore in the form of incurred but not reported reserves, to the U.S. liability portfolio, reinforcing overall reserve strength. The majority of the liability reserve additions were once again offset by releases and other lines, while the remainder was compensated by a strong underlying margin. As a result, PNC remains fully on track to achieve a better-than-95 reported combined ratio for the full year. Premiums earned in PNC REIT were up 5.4% at cost and FX rates for the first nine months. Property and specialty... Excuse me. 5.4% at constant FX rates for the first nine months. Property and specialty gross premiums written are up by about $700 million year-to-date, supported by the significant price increases we achieved through the year. Looking just at the third quarter, gross premiums written were lower by about around $400 million. The main driver of this is the fact that in the third quarter, Gross premiums written are more heavily driven by the recent July renewals where we accelerated our continued pruning of casualty lines. Premiums are therefore developing in line with our portfolio strategy. Corporate Solutions continues to deliver quarter after quarter with nine months reported combined ratio now at 91.3, well on track to achieve the better than 94% full year target. Importantly, Corso achieved risk-adjusted price increases of 5% in the third quarter. Life and Health reproduced net income of $241 million, closing some of the prorated gap of the first half relative to the $900 million full-year net income target. We continue to target a full-year net income of this amount. We had a very strong return on investment in the third quarter, of 4.8%. On the one hand, this was driven by an increase in the recurring income with the recurring income yield now at 3.7%. We also sold selected real estate positions and offset the majority but not all of these gains with targeted sales of fixed income instruments to further improve the recurring income. Group items benefited from an accounting treatment change on our FWD investment. Part, but not all, of our equity investment in FWD was at an operating company level. As a result of FWD's corporate restructuring in the third quarter, this investment, along with all others, was consolidated at the holding company level. And as a result, Swiss Re is no longer judged to have, for accounting purposes, significant influence at the holding level of the company. Therefore, this portion of the investment will now be accounted for at fair value instead of the equity method, which had previously been valued at. The carrying value in our books before this change was close to zero. The current carrying value for the fair value method of all of our equity investments in FWD is now approximately $700 million. And the P&L impact under the change of the accounting treatment in Q3 can be seen in slide 23. under the realized gains in group items. Our SST ratio of 314% as of the 1st of July remained very strong. We recently bought back $1.5 billion of subordinated debt, thereby accelerating the deleveraging plans of management. The impact of the buyback is around minus 10 percentage points on the current SST ratio. Despite this, because of changes of interest rates, we estimate that we remain close to the mid-year number. Our capital management priorities remain unchanged. Our primary focus remains on achieving our financial targets and returning to sustainable dividend growth. With that, I'll hand over to Thomas, who will introduce the Q&A session.

Thank you, John, and hello to everyone. All of you from my side as well, as usual, I could ask you to limit yourselves to two questions, and should you have any follow-up questions, if you could please rejoin the queue. So with that, operator, could we please have the first question?