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Introduction & Market Context
Spanish insurance giant Mapfre (BME:MAP) presented its first quarter 2025 results on April 25, showing robust growth across key metrics and raising its strategic plan targets. The company’s stock closed at €2.93 on the presentation day, near its 52-week high of €2.95, reflecting investor confidence in the insurer’s performance trajectory.
Building on the momentum from its record profit in Q4 2024, Mapfre has continued to demonstrate operational improvements, particularly in its motor insurance segment, while benefiting from a more balanced earnings mix across regions.
Quarterly Performance Highlights
Mapfre reported a net profit of €276 million for Q1 2025, representing a 27.6% increase compared to the same period last year. This strong performance was supported by a 5.4% growth in premiums, which reached €8,584 million, and an improved non-life combined ratio of 94.1%, down 1.7 percentage points year-over-year.
As shown in the following key financial results:
The company’s return on equity (ROE) reached 11.7%, an increase of 0.8 percentage points, while the adjusted ROE stood at 12.8%. These improvements reflect Mapfre’s enhanced operational efficiency, with claims ratio decreasing by 1.1 percentage points to 66.9% and expense ratio improving by 0.6 percentage points to 27.2%.
The Solvency II ratio stood at a solid 207.4%, providing the company with financial flexibility to support future growth initiatives while maintaining resilience against market volatility.
Regional Performance Analysis
Mapfre’s performance showed significant regional variations, with particularly strong results in Iberia and North America offsetting challenges in other markets.
The regional breakdown reveals substantial profit growth across most territories:
The Iberian business delivered the strongest contribution to results, with net profit surging 65.6% to €121 million. This improvement was driven by better technical management and a strong recovery in the motor combined ratio, which improved to 98.3%.
North America posted the most dramatic improvement, with net profit nearly doubling (+94.3%) to €30 million, marking a record first quarter result for the region. The excellent motor combined ratio of 96.9% in this region demonstrates the effectiveness of technical measures implemented by the company.
Latin America continued to be a key contributor to both premiums and results, with net profit increasing by 25.4% to €118 million. Brazil, despite an 11.9% decline in premiums, maintained a strong ROE of 25.9% and an impressive non-life combined ratio of 76.3%.
The only significant negative performance came from Mapfre RE, the group’s reinsurance unit, which saw its net result decline by 28.2% to €48 million, primarily due to the impact of California wildfires, which cost the company €85 million net of tax and non-controlling interests.
Detailed Financial Analysis
Mapfre’s premium breakdown shows varied performance across business lines, with general P&C and accident & health insurance showing the strongest growth at 3.8% and 5.5% respectively. The auto segment also performed well with 3.5% growth, while life protection declined by 7.6%.
The premium composition illustrates the company’s diversified business model:
In the auto insurance segment, which has been a focus area for improvement, Mapfre showed significant progress with the combined ratio improving across key markets. The North American auto business was particularly impressive, with the combined ratio improving from 102.4% in the previous quarter to 96.9% in Q1 2025.
The auto segment performance across regions shows this positive trend:
The company’s investment portfolio and assets under management remained stable at €59.6 billion, with a conservative allocation primarily focused on fixed income securities. The accounting yield on these investments varied significantly by region, from 2.60% in Iberia Non-Life to 11.89% in Brazil, contributing to the overall financial performance.
Strategic Initiatives & Updated Targets
In a significant vote of confidence in its future performance, Mapfre has raised the targets in its 2024-2026 strategic plan. The company now aims for an ROE of 11-12% (up from 10-11%) and a combined ratio of 94-95% (improved from 95-96%).
The updated strategic plan targets reflect this increased ambition:
The company’s closing remarks emphasized several key strategic priorities:
These strategic initiatives focus on technical excellence, particularly in the motor segment, and leveraging the company’s financial strength to support growth while maintaining resilience against market volatility.
Forward-Looking Statements
Looking ahead, Mapfre expects to maintain premium growth above 6% for the 2024-2026 period, excluding life savings products. The company aims to maintain a solvency ratio around 200% (±25 percentage points) and a leverage ratio of approximately 24%, while continuing its shareholder-friendly dividend policy with a payout ratio exceeding 50%.
The improved performance in the motor segment, particularly in Spain and North America, is expected to continue as technical measures implemented by the company take full effect. The company also anticipates continued benefits from higher interest rates, which are boosting financial income across its investment portfolio.
While Mapfre’s presentation highlighted its achievements and optimistic outlook, the company acknowledged potential challenges from geopolitical instability and the impact of catastrophic events, as evidenced by the California wildfires affecting its reinsurance business in Q1. The company is reinforcing prudence in reserves to address these risks while pursuing its growth strategy.
Full presentation:
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