Generali 9-month net profit rises 27%, beats expectations

[MILAN] Italy's top insurer Generali said on Thursday its net profit in the first nine months of the year rose 26.8 per cent to beat expectations, lifted by stronger life premiums and disposals.

Net profit reached 1.86 billion euros (S$2.91 billion), above a consensus analyst forecast provided by the company of 1.83 billion euros.

Gross premiums rose 6.1 per cent to 49.7 billion euros, with a 7.8 per cent increase in its life business.

The group's economic solvency ratio - a measure of financial strength - came in at 221 per cent, in line with levels at the end of June, but below 230 per cent at the end of last year.

Chief Financial Officer Cristiano Borean said the insurer's capital position remained solid, despite volatility in the financial markets during the year.

Government bonds have come under pressure as Italy's new ruling coalition looks to borrow to fund increased welfare spending and tax cuts.

Generali, which is due to present its new plan on Nov 21, holds around 60 billion euros of Italian state bonds.

The European Commission has asked Italy, which is targeting a deficit of 2.4 per cent of gross domestic product next year, to modify its draft budget, but so far Rome has shown no sign of complying.

REUTERS