Hannover Rück SE Shanghai Branch. Solvency Report Summary 2017 Q4

Transcription

1 Hannover Rück SE Shanghai Branch Solvency Report Summary 2017 Q4

2 Solvency Report Summary 2017 Q4 1. Basic information 1.1. Name of Company Hannover Rück SE Shanghai Branch 1.2. Registered Address: Suite , Building 1, Lujiazui Century Financial Plaza, 729 South Yanggao Road, Shanghai, P.R.China General Manager: Lye Fook Kong ( 译名 : 黎福光 ) 1.4. Scope of business and area of operations: Life Reinsurance, includes Reinsurance business within the territory of China; Retrocession business within the territory of China; International reinsurance business. Nonlife Reinsurance, includes Reinsurance business within the territory of China; Retrocession business within the territory of China; International reinsurance business Ownership structure and shareholders List of Top 10 major shareholders at the end of current quarter Order Name of shareholders Actual Investment (in CNY 10,000) Stake (%) Share Class Share Status 1 Hannover Rück SE 130, % Foreign shares Normal Page 1/7

3 1.6. Subsidiaries, joint ventures and affiliates We have no subsidiaries, joint ventures and affiliates in this quarter Basic Information about senior management Name Age Education Title Term start date Qualification approval document number Lye Fook Kong ( 译名 : 黎福光 ) 江瀚 JIANG Johnson 王岩 WANG Yan 43 盛毅 SHENG Sunny 39 Bachelor of Insurance Business Bachelor of Economics Doctor of Economics and Social Sciences Master of Business Administration GM Director of Investment July 31, 2015 June 06, 2015 DGM May 31, 2008 Chief Actuary July 28, 2008 January 4, 2018 DGM Mar 5, 2014 DGM Feb 20, 2017 CFO Sep 21, 2009 CRO Apr 1, 刘晓岚 LIU Helen 36 LLM CCO Aug 28, 2015 CIRC approval [2015] No CIRC International [2008] No.421 CIRC P&C [2008] No. 960 CIRC P&C [2009] No. 684 CIRC P&C [2010] No. 868 CIRC P&C [2011] No CIRC P&C [2012] No. 898 CIRC approval [2014] No.195 CIRC approval [2017]No. 130 CIRC Accounting [2009] No.952 CIRC approval [2015]No. 879 Tenure and part-time status in the related party and other units 项宇 XIANG Master of Chief January 5, CIRC approval 40 Karry Economics Actuary 2018 [2017]No Note: On January 5 th, 2018, the Branch submitted report to CIRC (Hannover Re [2018] No.6) to appoint Mr. Karry Xiang as Chief Actuary of the Branch, meanwhile removing Mr. Johnson Jiang from the position of Chief Actuary Contact person for solvency information disclosure Name: 盛毅 SHENG Sunny Tel: Mobile: Fax: sunny.sheng@hannover-re.com Page 2/7

4 2. Main indicators 2.1. Solvency ratio indicators (CNY; %) Name of indicator Current quarter Last quarter Core solvency surplus 1,184,369,455 1,289,563,451 Core solvency adequacy ratio 215% 239% Comprehensive solvency surplus 1,184,369,455 1,289,563,451 Comprehensive solvency adequacy ratio 215% 239% 2.2. The latest comprehensive risk rating According to the requirements from CIRC Notice of Data Preparation for the Solvency ǁ Risk Comprehensive Rating for 2017Q3 (Cai Kuai Bu Han [2017] No.935), we completed the reporting for 2017Q3 Risk Comprehensive Rating. Notification of the Risk Comprehensive Rating Result (Classified Regulation) for 2017Q3 (Cai Kuai Bu Han [2017] No.1545) was received in December 2017 which announced that we were classified as A-level in the Risk Comprehensive Rating (Classified Regulation) for 2017Q Business Indicators (CNY) Name of indicator Current quarter Last quarter Insurance business income 1,309,820,421 1,199,886,370 Net profit -13,245,811-9,999,409 Net assets 1,452,807,836 1,499,295, Actual capital (CNY) Name of indicator Current quarter Last quarter Admissible assets 27,273,258,741 26,594,568,072 Admissible liabilities 25,061,739,690 24,378,273,565 Actual capital 2,211,519,051 2,216,294,507 Including: Core tier 1 capital 2,211,519,051 2,216,294,507 Core tier 2 capital - - Supplementary tier 1 capital - - Supplementary tier 2 capital - - Page 3/7

5 4. Minimum capital (CNY) No. Name of indicator Current quarter Last quarter 1. Minimum capital 1,027,149, ,731, Minimum capital for quantitative risk 1,048,753, ,223, Minimum capital for Nonlife insurance risk 630,105, ,466, Minimum capital for Life insurance risk 266,815, ,361, Minimum capital for Market risk 172,229, ,595, Minimum capital for Credit risk 468,348, ,974, Correlation 488,744, ,175, Loss absorbency of specific insurance contracts Minimum capital for control risk -21,604,331-19,492, Supplementary capital The latest two comprehensive risk ratings (classified regulation) The Risk Comprehensive Rating (Classified Regulation) for 2017Q2: A-level. The Risk Comprehensive Rating (Classified Regulation) for 2017Q3: A-level. 6. Risk management requirement and assessment 6.1. The latest SARMRA assessment result Items Score SARMRA result Including: Risk management foundation and environment Risk management targets and tools 7.40 Insurance risk management 8.46 Market risk management 8.51 Credit risk management 8.16 Operational risk management 8.28 Page 4/7

6 Strategy risk management 8.51 Reputation risk management 8.87 Liquidity risk management Risk management execution framework Hannover Re Shanghai Branch is subject to the Hannover Re Group s risk strategy and risk management framework. Our current corporate strategy encompasses ten guiding principles that safeguard the realization of our vision Long-term success in a competitive business across the various divisions. The following principles of the corporate strategy constitute the key strategic points of departure for our Hannover Re Group-wide risk management: We manage risks actively. We maintain an adequate level of capitalization. We are committed to sustainability, integrity and compliance. The risk strategy is derived from our corporate strategy. It forms the core element in our handling of opportunities and risks. The risk strategy specifies more closely the goals of risk management and documents our understanding of risk. We have also defined overriding principles within our risk strategy: We adhere to the risk appetite set by the Executive Board. We integrate risk management into value-based management. We promote an open risk culture and the transparency of our risk management system. We fulfil regulatory requirements. We fulfil the requirements of rating agencies. We act in light of materiality and proportionality considerations. We make balanced use of both quantitative and qualitative methods. We ensure the independence of the risk management function. The risk strategy is similarly specified with an increasing degree of detail on the various levels of the Branch. The risk strategy, risk register and central system of limits and thresholds as integral components of our Risk and Capital Management Guideline are reviewed at least once a year. In this way we ensure that our risk management system is kept up-to-date. We manage our total enterprise risk such that we can expect to generate positive Group net income with a probability of 90% p. a. and the likelihood of the complete loss of our economic capital and shareholders equity does not exceed 0.03% p. a. These indicators are monitored using our internal capital model and the Executive Board is informed quarterly about adherence to these key parameters as part of regular reporting. The necessary equity resources are determined according to the requirements of our economic capital model, regulatory parameters, the expectations of rating agencies with respect to our target rating and the expectations of our clients. Above and beyond that, we maintain a capital cushion in order to be able to act on new business opportunities at any time. The internal target capitalization of the Hannover Re Group is therefore significantly higher than the minimum confidence level of 99.5% required under the European Solvency II regime. The Hannover Re Group is regulated in Europe under Solvency II. In addition, Hannover Re Shanghai Branch is regulated according to the China Risk-oriented Solvency System. Page 5/7

7 6.3. Measures to improve risk management and progress To improve our comprehensive risk management capability in accordance to the relevant requirements set out in The insurance company solvency regulation no.11: solvency risk management requirements and assessment, we made the following progress in the risk management area: CIRC implemented the on-site review to Shanghai Branch in Aug 2016, according to CIRC Notice of 2016 SARMRA reviewing result (Cai Kuai Bu Han [2017] No.328), our SARMRA score for 2016 is According to CIRC Notice of 2017 SARMRA review (Bao Jian Cai Kuai [2017] No.156), Shanghai Branch is not included in the 2017 SARMRA review scope. Thus, the Branch will continue using the 2016 SARMRA score to calculate the minimum capital for control risk. During this reporting period, Group Audit conducted internal audit on the Branch regarding C-ROSS and SARMRA. The overall audit result was satisfactory. Currently, we are following Group Audit s suggestion on areas for improvement according to the agreed timetable. Meanwhile, risk management team finished annual review for the risk management procedures and risk management policies. Risk management procedures saved in the Group s process documentation system were updated. Risk policies that were newly added, updated and abolished during the year were recorded and filed, making our risk management work more professional and standardized. Our Branch's risk management team will continue to monitor the progress of all risk management improvement measures; provide timely information and follow up actions; ensure the soundness of the risk management system; support the effective implementation of risk management works in both the business areas and company governance; strengthen the Branch's awareness of risks it faced and its risk management capabilities especially in the area of solvency risk management. 7. Liquidity risk 7.1. Liquidity risk regulatory items(cny; %) Items This quarter Net cash flows 111,351,430 Consolidated liquidity ratio Within 3 months 137% Within 1 year 92% Above 1 year 129% Liquidity coverage ratio Stress Scenario % Stress Scenario % Liquidity coverage ratio on separate accounts of investment-linked insurance business Not applicable Page 6/7

8 7.2. Liquidity risk analysis and coping measures Changes on liquidity risk regulatory items In this reporting period, the net cash inflow is around CNY 110 million (total net outflow of CNY 280 million this year). Amongst which, net cash inflow from operating activities is about CNY 360 million and net cash outflow from investment activities is about CNY 250 million. For the consolidated liquidity ratio, the total asset is larger than total liability. The consolidated liquidity ratio within each period continues to be reasonable, showing that our consolidated liquidity is safe and sound. The Branch s investment assets are of high quality. Under the stress scenarios 1 and 2, the coverage ratios are 1341% and 2354%, respectively, indicating that the Branch s liquidity coverage is more than adequate Analysis on the difference between reporting periods, coping measures and target of improvement In this reporting period, net cash outflow from investment activities is around CNY 250 million, which is mainly due to reinsurance premium received during this quarter being invested in bonds and money market fund. Cash item (current deposit) in the statement of cash flow is about the same as last quarter, maintaining at an appropriate level. Consolidated liquidity ratio and liquidity coverage ratio continues to be at a reasonable level for this reporting quarter. 8. Regulatory measures taken by regulatory authorities against the company 8.1. Regulatory measures taken by the CIRC against the company No regulatory measures were taken by the CIRC against the company in the reporting period Rectification measures adopted by the company and information about implementation Not applicable. Hannover Rück SE P.O. Box , Hannover, Germany Supervisory Board Herbert K. Haas/Chairman Executive Board Ulrich Wallin/Chairman, Sven Althoff, Claude Chèvre, Jürgen Gräber, Dr. Klaus Miller, Dr. Michael Pickel, Roland Vogel Registered Office Hannover, Commercial Register Hannover, HRB 6778 Page 7/7