Mon, Feb 07, 2011 - Page 6 News List

Suncorp Group reiterates banking unit’s importance

Bloomberg

Suncorp Group Ltd, an Australian insurer and lender facing payouts for the Queensland flood disaster, said its banking unit is an important part of the company’s business.

“We have a very clear strategy,” chief executive Patrick Snowball told an Austlian TV program yesterday. “We’re a diverse financial services group, we meet the aspirations of middle Australia. Part of that is the bank. The bank is traveling very well.”

He declined to answer a question on whether Suncorp would be willing to sell the banking unit.

Snowball, who took over leadership of the largest Brisbane- ased insurer in September 2009, said later that year that Suncorp was too complicated, burdened with duplication and needed leadership. Yesterday, he reiterated a plan to widen the underlying profit margin at the insurance business, the group’s biggest unit, by at least 3 percentage points by June next year.

Suncorp expects its net claims costs arising from Cyclone Yasi will be capped at A$10 million (US$10 million), it said on Wednesday.

Australia’s southern and eastern states have been swamped by flash floods, rains and swollen rivers for the past two months, leaving 35 people dead and a damage bill that economists say may reach A$20 billion.

“We have substantial premiums across Queensland, but our exposure in Queensland is not disproportionate to the exposure we have across the whole of Australia,” Snowball said.

The company will report first-half results on Feb. 23.

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