The world's largest reinsurance group, Swiss Re, today predicted losses of 1.2 billion Swiss francs ($1.07 billion or €732m) due to the US sub-prime mortgage crisis.
Swiss Re said its sub-prime securities had been written down to 62% of their starting value.
'The excellent performance of the group throughout the year to date means that Swiss Re is able to absorb the extraordinary financial market developments in October,' said CEO Jacques Aigrain.
'Despite this, it is clear that further improvement and reinforcement of our financial risk taking process is appropriate and we have taken immediate action to make the necessary changes,' he said in a statement.
Swiss Re said at the start of the month that it had weathered turbulent financial markets as it reported a 5% drop in third quarter net profit due to lower investment earnings.
The company's quarterly net profit came in at 1.469 billion Swiss francs compared with 1.550 billion Swiss francs for the third quarter of 2006.
