Bloomberg News

Generali Plans to Increase Cost Cuts, Boost Efficiency, CEO Says

October 04, 2011

Oct. 4 (Bloomberg) -- Assicurazioni Generali SpA, Europe’s third-biggest insurer, plans to increase cost reductions amid global “financial volatility,” Chief Executive Officer Giovanni Perissinotto said.

The firm plans to cut information-technology costs and improve the efficiency of asset and real-estate management “through the full integration of these functions across the whole group,” the CEO said today at a conference held by Merrill Lynch in London. His comments were confirmed by a company spokeswoman.

Trieste, Italy-based Generali, which is expanding in emerging markets including China and the Middle East to boost profit, expects higher operating margins in the life and non- life businesses this year. The insurer’s second-quarter profit fell 45 percent, hurt by writedowns of Greek bonds and its stake in Telco SpA.

“We have to be ready to live in a world characterized by stagnant growth, low returns and great financial volatility,” Perissinotto said. “This adverse trend is accentuated by the lack of decisiveness and coordination of actions.”

About 94 percent of the company’s government bond holdings have an A rating or higher, he said.

--Editors: Stephen Taylor, Dan Liefgreen

To contact the reporters on this story: Marco Bertacche in Milan at mbertacche@bloomberg.net; Sonia Sirletti in Milan at ssirletti@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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