1st Nov 2005 07:00
SVB Holdings PLC01 November 2005 For immediate release1 November 2005 SVB Holdings PLC ("SVB") Updated estimated impact from US windstorms SVB has conducted a preliminary assessment of the impact of Hurricane Wilmawhich made landfall on the US on 24 October. Our initial estimate of the lossarising to SVB from this event, net of reinsurance and reinstatement premiums,is £5 million - £10 million. We have also reviewed the potential impact of Hurricane Rita which made landfallon 24 September. Our estimate of the loss to SVB, net of reinsurance andreinstatement premiums, remains at the level of our initial internal assessmentof around £5 million. With regard to Hurricane Katrina, SVB announced on 9 September that, on theassumption the insured loss arising from this event was $40 billion, the loss toSVB, net of reinsurance and reinstatement premiums, would be around £25 million.A net loss of this magnitude was expected to reduce profit before tax for 2005by around £10 million. Throughout the industry there remains material uncertainty as to the ultimate outcome of Hurricane Katrina, both in terms of loss advices from brokers and interms of legal and regulatory issues, and there are concerns that the industry loss will increase. Should the insured loss arising from Hurricane Katrina rise to $60 billion, the ultimate loss to SVB would be around £40 million, net of reinsurance and reinstatement premiums, with a resultant effect on profits before tax of around £25 million. For 2005, SVB budgeted for property catastrophe losses of around £15 million. If aggregate losses from Hurricanes Katrina, Rita and Wilma, net of reinsurance and reinstatement premiums, amount to £40 million as per present estimates, the effect will be to reduce profits before tax by £25 million. At an aggregateloss of £55 million from these three hurricanes, the effect would be to reduceprofits by approximately £40 million. Following Hurricanes Katrina, Rita and Wilma, rates on wholesale propertybusiness are already increasing sharply. Furthermore, they are collectivelyprompting profound changes in the reinsurance market globally. There will behighly attractive underwriting opportunities presented by this new environment,and SVB is positioning itself accordingly to take advantage. - ENDS -For further information: SVB Holdings PLCMatthew Fosh 020 7903 7300 M: CommunicationsNick Miles 020 7153 1539 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Novae Group