Swiss Re reports first loss in 6 yrs

Swiss Reinsurance Co, the world's second-biggest reinsurer, posted its first loss in almost six years and suspended a share buyback program after wrong-way bets on credit derivatives.

Swiss Re declined in Zurich trading after reporting a third- quarter loss of 304 million Swiss francs ($259 million), compared with net income of 1.47 billion francs a year earlier, the Zurich-based company said yesterday. The median estimate of eight analysts was a 150 million-franc profit.

Swiss Re booked a writedown of 289 million francs on credit default swaps written to protect a client, bringing mark-to-market losses on the securities over the past year to 2.81 billion francs. Chief Executive Officer Jacques Aigrain has increased hedging against corporate credit risks as the global financial crisis worsened.