22 February 2017Insurance

SCOR reveals potential share buyback scheme in 2016 results

French reinsurer SCOR is sitting on a pile of excess capital worth as much as €200 million and could end up with the same amount again if a reorganisation of its different legal entities goes to plan.

As a result, the company is mulling a two-year share buyback programme as one of the options for dealing with this surplus capital, the company revealed in its  2016 results.

The company said its solvency ratio now stands at a high level, above the optimal range, meaning it has this surplus capital available. It said it could either accelerate its growth (but this depends on potential profitability meeting its targets), adapting its risk profile, increasing its dividend growth rate and/or buying back shares.

It said the level of excess capital above the optimal range is approximately €200 million as at 31 December 2016. The terms of the share buybacks (amount and timing) will be settled by the board of directors, in accordance with the group's growth performance, SCOR said.

The company also revealed that it is also in the progress of looking to optimise its legal entities, which would mean merging SCOR SE, SCOR Global P&C SE and SCOR Global Life SE in early 2019.

It said that the potential savings of the reorganisation may reach up to another €200 million in solvency capital.

Denis Kessler, chairman and chief executive of SCOR, said: "SCOR is actively pursuing its shareholder remuneration policy, raising its dividend to €1.65, and now envisages share buybacks."

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More on this story

22 February 2017   France’s reinsurer SCOR is searching for opportunities to deploy its excess capital which is set to grow further through the ongoing merger of its units and is unlikely to be squeezed by a qualification of SCOR as a systemically important financial institution.
22 February 2017   Profits dipped at SCOR in 2016 in what was an otherwise solid set of results for the French reinsurer, which continued to grow largely thanks to contributions from its Global Life unit while its Global P&C business also expanded its footprint in the US.
14 February 2017   SCOR Global Life has made several promotions in the US with immediate effect, including chief actuary, COO and head of US markets.