Shares in insurance group FBD dropped sharply in Dublin today after a trading statement warned of intense price competition in the insurance market. It also said that recent weakness in government bond markets had hit investment returns and pre-tax profits.
In the statement for the first six months of the year, FBD said its share portfolio was performing satisfactorily to date, and it was comfortable with the market's expectation for full year operating profit of 324 cent per share.
In its core underwriting business, FBD said it had maintained policy growth and premium written was slightly ahead of 2006, despite intense price competition. FBD is now Ireland's fourth largest general insurer.
'Price competition remains intense and our full year gross premium written target will become increasingly challenging unless pricing pressure moderates', the company said.
FBD said that claims and other costs were running at anticipated levels, with its leisure, property and financial services interests performing to budget.
The group's interim results are scheduled to be announced on August 29.
In April FBD said it planned to distribute €177m of the company's reserves to its shareholders. It said today that this had resulted in a reduction in the assets held in the Capital Fund to a total of €40m currently.
FBD shares ended down just over 3% at €31.96 in Dublin.
