Swiss Re Shares Jump After Reinsurer Tops Up Returns With $1 Billion Buyback

By Elena Vardon

Swiss Re's shares traded higher after the reinsurer paired its quarterly results with a surprise $1 billion share buyback, signaling a more aggressive stance on capital returns.

The Zurich-based group on Friday said that it would repurchase $1.5 billion of its own shares over the course of the year. The program includes the introduction of a recurring annual $500 million buyback as announced late last year, plus the $1 billion top up.

The stock climbed around 5% in early trading to hit its highest level since before a December investor day that had weighed on shares.

J.P. Morgan analysts described the unexpected extra buyback as "the culmination of a number of resilience building activities and strong [Swiss Solvency Test ratio]." The move reflects a pattern of proactive capital management often seen as pricing cycles soften, where underwriters prioritize capital returns over chasing volume, Jefferies wrote in a note to clients.

Analysts at Keefe, Bruyette & Woods struck a more cautious note and questioned the sustainability of such payouts as the total capital return slightly exceeded net operating capital generation for the year.

For the full year, Swiss Re reported a 47% jump in net profit to a record $4.8 billion, beating its own guidance of more than $4.4 billion for 2025. The increase was driven by disciplined underwriting and a benign catastrophe environment in its property and casualty units, which helped offset a weaker showing in its life and health business.

Performance in the last three months of the year was more nuanced. Swiss Re's net income reached $717 million, beating the company-compiled consensus of $687 million but falling sharply from the $1.05 billion recorded a year earlier. The top-line was also softer as insurance revenue slipped 6% to $11.14 billion while its investment result fell 12% to $966 million, with both metrics trailing consensus expectations.

The quarterly print was weighed down by a review of underperforming life and health portfolios in Australia, Israel and South Korea. Swiss Re had warned this would shave off $250 million from its fourth-quarter earnings, leading it to miss its the division's annual profit target. While the review is now completed, analysts remain divided with some noting that the managed impact should reassure while others cautioned it may take some quarters of clean results to believe the issues are in the rearview mirror.

"All three of our business units are positioned to deliver consistent results," Chief Executive Officer Andreas Berger said. The company maintained its $4.5 billion net profit target for 2026, which includes a $1.7 billion contribution from the rehabilitated life and health business.

In addition to the buybacks, the board proposed a 9% increase to its annual dividend to $8.0 per share.

Write to Elena Vardon at elena.vardon@wsj.com

(END) Dow Jones Newswires

February 27, 2026 04:39 ET (09:39 GMT)