Swiss Life shares surge 6% on chief executive's resignation

The chief executive of Swiss Life has decided to step down next year, sending shares in the insurer soaring, barely a year after he launched a three-year plan to boost profits.

Bruno Pfister, an executive at Swiss Life for more than a decade, became chief executive in 2008 and guided the company through the roller-coaster years of the financial crisis. He did not give a reason for his departure, merely saying it was "a good point for me to begin a new chapter in my career."

He will be replaced by Patrick Frost, the company's chief investment officer since 2006. The handover will take place on July 1 next year. Shares in Swiss Life rose 6 per cent on the news to SFr190.40.

Rolf Dorig, Swiss Life's chairman, said the appointment did not herald a change in strategy. "We are extremely pleased that, with Patrick Frost, we have been able to appoint the new group CEO from among our own ranks - this is also a sign of continuity," he said.

Mr Pfister, 54, spent his first years as CEO battling to keep the company on an even keel as asset prices plummeted with the advent of the financial crisis.

Soon after his appointment, Swiss Life was forced to issue two profit warnings in three months as the value of the shares and corporate bonds it owned slumped dramatically, forcing it to make big writedowns.

Following the second warning, the group's shares lost a fifth of their value in one day, after the company said that the volatility in financial markets made profit guidance impossible.

However, since then Mr Pfister has overseen a turnround, working to strengthen the company's balance sheet, as well as improve its profitability.

The group was hit by a SFr578m writedown last year mostly on the German advisory business it bought for €1.1bn in 2007, but analysts said that Mr Pfister was handing on the company in relatively good shape.

"They have made good progress in changing their business mix, they are writing more unit-linked business, and their margins are higher," said one analyst who asked to remain anonymous. "From that perspective perhaps it is a good time to hand over."

Mr Frost, 45, will inherit the three year targets set last November by Mr Pfister, which include a return on equity of between 8 and 10 per cent, and a SFr160m cost savings plan.

In the three months to the end of September, the insurer wrote premiums worth SFr3.29bn, up 8 per cent on the same period a year earlier.

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