Economy 31 May 2012, 10:52am

Vienna Insurance Group plans expansion in Hungary - CEO

Portfolio

Vienna Insurance Group wants to expand in Hungary, its outgoing chief executive told Austria’s NEWS magazine, predicting his successor would keep generating record profits.

Vienna Insurance Group is represented in Hungary by the composite insurer Union Biztosító and the life insurance company Erste Biztosító. Erste Biztosító sells its products through the branch network of Erste Bank Hungary Nyrt.

"Our focus at the moment is on Hungary. We got in there too late," Reuters cited Günter Geyer as telling NEWS magazine in an interview. He did not elaborate on its expansion plans.

Peter Hagen, VIG's new chief executive, said it would be a "great challenge" to keep boosting the group's earnings, but Geyer was more upbeat.

"I already know now that Peter Hagen will deliver the best results of all time at the end of the year. We are programmed this way," he said, citing growth potential from its markets in emerging Europe.

In 2011 Vienna Insurance Group earned consolidated premiums of EUR 8.9 billion, up 3.4% yr/yr. Pre-tax group profit increased by 10.1% to EUR 559.0 m, which is the best-ever result in the Group’s history. Net profit after minorities came in at EUR 406.7 m, 7.1% higher than in 2010.

In Q1 of 2012 Vienna Insurance Group earned a total of EUR 2.7 billion of (consolidated) premiums written, growing by 5.5% compared to the same period of the previous year.

Group profit (before taxes, consolidated) amounted to EUR 151.4 million in January-March, up 6% yr/yr. After-tax profit went up by 7.9% to EUR 117.7 million.

“In 2012 the focus will remain on strengthening organic growth - by promoting business with existing companies. This will, however, not exclude the possibility of acquisitions rounding off the portfolio. Vienna Insurance Group set itself the goal of growing above market average in the next years. The Management of Vienna Insurance Group has committed itself to keeping volatilities as low as possible by taking into account the economic background. Vienna Insurance Group also strives to identify costcutting potentials on an ongoing basis and to use them to the best advantage," the company said in its Q1 earnings report.