RSA’s Hester apologises to shareholders but says insurer is in ‘good shape’

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The insurer’s share price has been performing poorly, losing almost a third of its value since the beginning of the year

RSA group chief executive Stephen Hester has apologised to shareholders for the insurer’s poor share price performance, but insists the insurer is in “good shape”.

Stephen Hester (large)

Stephen Hester, RSA

Speaking on a conference call for investors following the announcement of the insurer’s Q1 results, Hester said the decision to suspend its dividend payment for 2019 was a difficult one.

“In a sense I want to apologise to our shareholders – our share price has performed very poorly,” he said. “We had to make a difficult decision on the dividend in common obviously with a number of other people and it has been difficult for us to provide the reassurance that we wanted to do until we were able to assemble the proper facts with which to do so.

”Of course, until we’re all the way through the crisis, we won’t be able to do that fully, but I hope today we have enough to give a great deal more reassurance than has been apparent in our share price.

“We understand that this company is here to serve customers and shareholders. We feel strongly that responsibility – all of us in the management team are heavily exposed to the fortunes of our share price and our company and be in no doubt of our determination to demonstrate that the share price is currently too bearish over time.”

Hester added, however, that the insurer’s results for the first quarter of 2020, which revealed an improving loss ratio, were strong and that the business was “in good shape, at both on a fundamental basis and to weather resiliently the corona crisis”.