• Gross written premiums almost triple
• Further growth in Asia Pacific and building of global footprint  
• More diversified underwriting portfolio

Peak Re further grew its franchise in its home markets in Asia Pacific and started to build a global footprint in 2014. This expansion translated into a broader diversification of the underwriting portfolio and an increase in cost-efficiency. As a result, Peak Re’s gross written premiums almost tripled to US$ 288 million. The Company’s administrative expense ratio declined by almost 20 percentage points to 9%. After-tax profits came in at US$ 42 million.

“2014 was a year of expansion”, says Franz Josef Hahn, Chief Executive Officer of Peak Re. “We continued to grow our franchise in our home markets in Asia Pacific and started to build a sizeable portfolio in EMEA and the Americas. Furthermore, we added credit and surety and life reinsurance to our suite of offerings. As a result our top line expanded considerably. More importantly, only in our second year in business, we were able to turn in a technical underwriting profit of US$ 15 million.”

“Our premium growth in 2014 was mainly achieved with existing clients who have chosen to allocate larger shares to Peak Re. This fills us with pride and demonstrates that we are on the right track. Delivering on our promises will remain a guiding principle of Peak Re’s business conduct as we move forward.”

Strong results

Peak Re posted gross written premiums (GWP) of US$ 288.1 million in 2014, an increase of 180% over the previous year’s US$ 103.2 million. Net written premiums (NWP) expanded even faster at 188%, from US$ 97.0 million in 2013 to US$ 279.7 million in 2014.

Business growth was primarily due to Peak Re’s expansion in Asia Pacific, which accounted for 80% of the Company’s premiums and the successful diversification in EMEA and the Americas.

In 2014, its second year of operations, Peak Re already generated its first technical underwriting profit of US$ 14.9 million, compared with a small underwriting loss in 2013. The technical combined ratio improved to 92.2%. As GWP rose by 180%, the expense ratio dropped by almost 20 percentage points to 9%. Over time, Peak Re aims to reduce this ratio further.

Along with premiums, Peak Re’s portfolio of investable assets grew by 15% from US$ 679 million in 2013 to US$ 781.5 million in 2014. The investment result amounted to US$ 55.6 million, tantamount to an excellent total return on investment of 7.6%. In its current start-up phase Peak Re runs a slightly above-average equity exposure. However, over time, fixed-income securities and the publicly listed bond portfolio will assume a larger share.

Peak Re’s after-tax profit amounted to US$ 41.6 million in 2014, down from the prior year’s US$ 102.9 million, which was driven by an exceptional investment result.

Consistent with its shareholders’ long-term growth and development strategy, Peak Re will retain its earnings for its first five business years and only later start paying dividends. As a result the Company’s net income will be allocated to shareholders’ equity, which at the end of 2014 amounted to US$ 688.4 million, up from US$ 652.7 million in 2013.

Expanded market reach

In 2014 Peak Re served clients in 30 markets. The client base almost doubled to 175 ceding companies. Peak Re’s larger client franchise is both a reflection of the Company’s successful diversification strategy and its rapidly growing recognition as a long-term oriented provider of multiline solutions. However, the bulk of Peak Re’s additional business in 2014 was written with existing clients who allocated larger shares to the Company, demonstrating their faith and confidence in Peak Re future progress.

Outlook

Peak Re has enjoyed a strong start into 2015. During the January renewals the Company grew its shares across the board in Asia Pacific, EMEA and the Americas. As a consequence the firm expects to write more business in 2015, which will translate into a further reduction of the expense ratio.

Peak Re expects that additional reinsurance capacity will pour into the Asian markets. China continues to rank highly on many global carriers’ growth agenda due to its insurance protection gap, sustained economic growth and the government’s resolve to further grow the insurance sector. With a Hong Kong domicile and its Chinese investor base, Peak Re is well positioned to succeed in an even more competitive trading environment.

In addition, the newly established capabilities in life and health reinsurance will cater to the specific needs of China’s rapidly growing middle class, one of the world’s most important sources of additional demand for insurance.

About Peak Re

Peak Re is headquartered in Hong Kong with an initial capital base of US$550 million. It is authorized by the Office of the Commissioner of Insurance of Hong Kong and is rated “A-” by A.M. Best, a leading international insurance industry credit rating agency.

The Company is backed by Fosun International Limited (HK.656) and the International Finance Corporation, member of the World Bank Group, who have respectively invested 85.1% and 14.9% in the Company.

Peak Re offers reinsurance treaty services covering a range of lines across Asia Pacific region, EMEA and the Americas, tailor-making risk transfer and capital management solutions to best fit clients’ needs.