Assicurazioni Generali SpA, Italy’s biggest insurer, said fourth-quarter profit slid 75 percent after impairments of its Russian stake and related to the sale of BSI. The insurer increased its dividend by 33 percent.
Net income declined to 81 million euros ($85 million) from 324 million euros a year earlier, Trieste-based Generali said Thursday. Generali raised its dividend for 2014 to 60 cents a share from 45 cents the previous year, in line with the Bloomberg forecast.
Chief Executive Officer Mario Greco, 55, has sold non-strategic assets to focus on the insurer’s main business, strengthen finances and bolster profitability since taking over in 2012. After having reached most of its targets ahead of schedule, the insurer will present a new strategy in May.
“Generali is focused on its core insurance business, more disciplined in the management of its balance sheet and capital,” Greeco said in the statement. “We are now preparing to begin a new chapter in our history and we look forward to presenting the next phase of our strategy in May.”
Annual results were hurt by 400 million euros of charges including impairments on its 38.5 percent stake in Russian insurer OEO Ingosstrakh and a provision related to the sale of BSI Group, its former Swiss private banking unit.
BSI, sold last year to Grupo BTG Pactual of Brazil, is one of at least 36 Category 2 Swiss banks seeking to avoid prosecution for handling undeclared American money by joining the U.S. Justice Department’s voluntary disclosure program. Generali has agreed with BTG to pay the eventual fine.
Operating income rose 1 percent in the fourth quarter from a year earlier to 840 million euros. Claims and costs as a proportion of non-life premiums, known as the combined ratio, improved to 93.8 percent, benefiting from a lower loss ratio and cost containment. The Solvency 1 ratio at the end of December reached 164 percent.