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How healthy is Swiss Re?

Do you remember the financial crisis of 2008? Many financial institutions got into difficulties. The world now pays much more attention to the financial health of companies. How do you think Swiss Re is doing?

Of course evaluating the overall financial health of a company is a tough task. In this challenge we focus on the topic of investments and your task is to analyze the financial figures of Swiss Re. You will be expected to provide your opinion on the numbers. Besides winning one of the attractive prices, by submitting a good solution you can win a ticket to an interview!

CHALLENGE

You are to analyze Swiss Re's Group financial statements as of 31 December 2015 from investments perspective. Go to Swiss Re's website and download the Group Financial Statements as of 31 December 2015. Answer the below questions:

1. List all financial statements line items that relate to investments results and investment balances reported in the FY2015 Group Financial Statements (Income Statement, Statement of Comprehensive Income, Balance Sheet). What do these numbers tell us about Swiss Re?
   
   
2. Look for Swiss Re’s 2015 Net Income and compare it with 2014. What developments do you see?
   
   
3. Calculate Swiss Re’s ROE. What does this value say about Swiss Re?
   
   
4. Calculate ROI. What does this value say about Swiss Re?
   
   
5. Based on the Notes to the Group Financial Statements describe the difference in valuation and accounting of fixed income securities classified as available-for-sale (AFS) and fixed incomes securities classified as trading. Show all impacted financial statement lines.
   
   
6. Describe how bonds are valued. Describe the relationship between interest rates and the price of a bond. Analyze the fixed-income portfolio of SwissRe. What are the reasons SwissRe invests in it?
   
   
7. If you had the chance to invest $1 billion USD on behalf of Swiss Re, where and into which products would you invest this money in current time (August 2016)? Why would you make this decision?
   
   

  ASSESSMENT CRITERIA:

1. Correct identification and calculation of figures
2. Your thoughts about the numbers and recommendations
3. Formal aspects of your solution

ADDITIONAL INFORMATION:

Your solution can be your ticket to an interview to our financial, asset management, re/insurance or other departments! If you are interested in a part-time or full-time job at Swiss Re, please include this sentence on the top of your solution: "I am interested in working for Swiss Re". All solutions will be reviewed about a week after submission, the winners will be announced after the deadline. 

About Swiss Re:
Swiss Re was established in 1863 and in 2007 Swiss Re Bratislava became a part of it. Since then we have managed to grow rapidly and our office in Bratislava currently occupies around 1000 employees and planning to grow up to 1200 till 2017.
 
Most of our work at Swiss Re is concerned with reinsurance. Simply said, it’s insurance for insurance companies. But, of course, it isn’t that simple. It’s a complex and fascinating business that draws on insights from every scientific discipline. Many of the risks the world faces today are far too great to be borne by insurance companies alone. Only by sharing the risk with reinsurers like Swiss Re they can continue to offer cover against these huge risks and keep prices at affordable levels.