Swiss Re has posted a loss in its second quarter results.

Swiss Re, one of the world’s leading reinsurers, has reported second quarter losses of CHF 381 million (£211m), mainly due to market losses on corporate bonds hedges, while Munich Re boasts profits of €703 million (£596m).

Although the closure of 14 of Swiss Re’s 73 global offices looks set to result in net savings of CHF 150m, overall the company suffered a heavy Q2 loss compared to a profit of CHF 564m reported in last year’s second quarter.

More positive results were reported in Swiss Re’s Property & Casualty division, up to CHF 1 billion from 0.9bn, and in its Renewals sector, which saw improvements in US and natural catastrophe markets.

Stefan Lippe, Swiss Re’s Chief Executive Officer, said: “During the second quarter of 2009, our core business, despite the reported loss, continued to deliver strong underwriting results and solid earnings power. Most importantly, the measures we implemented to improve our capital base have proven to be effective, considerably increasing our excess capital at the AA level.

“We have also made significant progress in de-risking Legacy with the termination of substantially all of our portfolio credit default swap contracts. This powerful combination increases our confidence in delivering on our targets.”

Swiss Re’s news comes as Munich Re posts a 2009 half-year profit of €1.1 billion, an increase of almost 12% on 2008’s results. Nikolaus von Bomhard, Chairman of the Board of Management at Munich Re, commented: “We were able to benefit further from our capital strength and exploit our scope for profitable growth. We regard the effects of the economic crisis as limited in extent for the Munich Re Group.”

In light of these strong results, the company is confident that its Return on Risk-Adjusted Capital (RORAC) projection will remain at 15%. Swiss Re also has a positive future outlook, as Lippe confirmed: “We believe the underlying operating trends are positive and we have the ability to allocate significant capacity to lines of business that offer an appropriate return on our capital.”