Hong Kong-based global reinsurer Peak Re has released its financial results for the first half of 2023, covering the six months ending on June 30.
Reinsurance revenue for the period totalled US$750 million, reflecting a decrease from the previous year’s figure of US$71 million. The net profit for this period stood at US$160 million, a significant improvement from the negative net profit of US$103 million during the same timeframe in the previous year.
The property and casualty (P&C) combined ratio was 82.2%, demonstrating a marked enhancement from the ratio of 108.4% reported in the comparable period. Additionally, the net assets for the first half of 2023 amounted to US$1.3 billion, a figure consistent with the net assets reported in the corresponding period of the prior year. The solvency ratio, a critical measure of an insurer’s financial stability, stood at 287%, representing a strong financial position compared to the ratio of 261% recorded in the same period last year.
The first half of 2023 proved to be highly successful for Peak Re, which the company touted as showcasing the effectiveness of prior management actions in rebalancing the portfolio and optimising capital allocations.
During the first half of 2023, Peak Re’s investment return saw an improvement to a solid 4.6% on an annualised basis. Investment income amounted to US$74 million, a significant improvement from the loss of US$95 million in the same period of 2022. This improvement can be attributed to higher recurring income yield and a decrease in unrealised losses on Peak Re’s fixed-income portfolio, compared to the first half of 2022.
By the end of the first half, Peak Re’s investable assets and net assets were US$3.0 billion and US$1.3 billion, respectively.
“As of 30 June 2023, Peak Re generated a strong net profit of US$160 million based on reinsurance revenue of US$750 million, reflecting the superb quality of our underwriting portfolio. Our P&C combined ratio stood at 82.2%, a testament to our robust underwriting and astute risk selection capability,” Peak Re CEO Franz-Josef Hahn said.
Overall, Hahn also gave a favourable outlook for the rest of year, noting that the company’s efforts at portfolio rebalancing continues to pay off in the face of a hardening market.
“We have built a high-quality P&C portfolio that is well-diversified in terms of business lines and geographies. In addition, our L&H business remains a strong contributor to our reinsurance business and is growing steadily. Given the favourable tailwinds of robust reinsurance demand and firmer P&C pricing, I am confident we are heading towards one of the most profitable years in the company’s history,” Hahn said.
Peak Re’s performance in the market has led to its placing in the top 40 global reinsurers list, as determined by S&P in its latest reinsurance highlights report.
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