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In the second quarter of 2025, Mapfre reported earnings per share (EPS) of $0.0879, surpassing the forecasted $0.0823, marking a 6.8% positive surprise. However, the company’s revenue fell short, coming in at $5.48 billion against a forecast of $6.65 billion, a 17.59% shortfall. According to InvestingPro data, the company maintains a FAIR Financial Health Score of 2.42, with particularly strong relative value metrics. Despite the mixed results, the stock saw a modest pre-market increase of 1.46%, reflecting a cautiously optimistic investor sentiment.
Key Takeaways
- EPS exceeded expectations by 6.8%, while revenue fell short by 17.59%.
- Stock price increased slightly, trading close to its 52-week high.
- Premiums grew over 5%, and net results rose nearly 24%.
- Challenges include currency volatility and geopolitical uncertainties.
- Positive outlook for motor insurance performance improvement.
Company Performance
Mapfre’s performance in Q2 2025 was marked by a notable increase in premiums and net results. Premiums grew over 5%, reaching CHF 16 billion, while the net result rose nearly 24% to $570 million. InvestingPro analysis reveals impressive revenue growth of 158.37% over the last twelve months, with a healthy current ratio of 2.17. These figures underscore the company’s strong operational capabilities despite external challenges such as high interest rates and geopolitical uncertainties. For deeper insights into Mapfre’s financial health and growth prospects, InvestingPro offers exclusive ProTips and comprehensive analysis in their Pro Research Report.
Financial Highlights
- Revenue: $5.48 billion (below forecast)
- EPS: $0.0879 (above forecast)
- Net result: $570 million (up nearly 24%)
- Adjusted Return on Equity: 13.3%
- Solvency ratio: 205.6%
Earnings vs. Forecast
Mapfre’s EPS of $0.0879 exceeded the forecast of $0.0823, offering a positive surprise of 6.8%. However, revenue fell short by 17.59%, coming in at $5.48 billion against a forecast of $6.65 billion. This revenue miss is significant and could weigh on the company’s stock performance in the near term.
Market Reaction
Following the earnings announcement, Mapfre’s stock experienced a slight pre-market increase of 1.46%, moving from $3.428 to $3.478. The stock remains close to its 52-week high of $3.88, suggesting resilience despite the revenue miss. The modest price movement reflects mixed investor sentiment, balancing the EPS beat with concerns over revenue shortfalls.
Outlook & Guidance
Looking forward, Mapfre is targeting a Return on Equity of 11-12% for the full year. The company remains cautiously optimistic about the second half of the year, anticipating continued improvements in motor insurance performance. Mapfre is prepared to navigate economic headwinds, including currency and geopolitical challenges.
Executive Commentary
Vice President Jose Manuel Inchiausti emphasized the strength of diversification, stating, "Diversification continues to be one of our strongest assets." He also noted the company’s readiness to face economic challenges: "We are prepared to face the headwinds from currency depreciations, inflation, and economic growth."
Risks and Challenges
- Currency volatility could impact financial performance.
- High interest rates, particularly in Brazil, may affect market conditions.
- Geopolitical uncertainties pose risks to business growth.
- Revenue shortfalls could pressure future earnings.
- Economic headwinds might challenge strategic initiatives.
Q&A
During the earnings call, analysts inquired about trends in the motor insurance portfolio and the strong performance in Brazilian agro insurance. Questions also addressed financial income variations and the outlook for the reinsurance business.
Full transcript - Mapfre (MAP) Q2 2025:
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Good afternoon, and welcome to MAPFRE’s activity update for the first half of twenty twenty five. This is Leandra Clarke, Head of Investor Relations and Capital Markets. Thank you for joining us today. We are pleased to have here with us Jose Manuel Inchiausti, Vice President of MAPFRE, who will provide some opening remarks and an overview of recent business trends. Following that, Jose Luis Jimenez, our group CFO, will discuss the main financials and Felipe Navarro, Deputy General Manager of the Finance area, will walk us through the balance sheet.
As a reminder, we report IFRS financial information twice a year, and we have reported the half year accounts to the CMV this afternoon. The information in this activity update is prepared under the accounting policies applicable in each country, which generally do not apply IFRS seventeen and nine. Jose Luis will also go over the main IFRS KPIs during the presentation. You can use the Ask a Question link at any point, and we will open up the question and answer session at the end of the call. I will now hand the floor over to Jose Manuel in Ciausti.
Jose Manuel Inchiausti, Vice President, MAPFRE: Thank you, Leandra. Good afternoon, everyone, and thank you for your time today. Let me share some highlights of the quarter before Jose Luis and Felipe walk you through the details. We are at the midpoint of our three year strategic plan and June’s figures are proof of the progress we have made. We are delivering figures in line with almost all updated charges announced at the AGM except growth, although it remains strong in local currencies.
Recent exchange rate movement from the current macro and geopolitical situation have impacted our top line, especially the U. S. Dollar and Latin America currencies. Premiums have still grown over five percent, reaching CHF16 billion, a 10% increase at constant exchange rates. Non life, which is approximately 75% of our business, continues to benefit from pricing adjustment.
Premiums in this segment are growing 7.5% at constant exchange rates, 2.5% in euros, reaching over €12,000,000,000 The Life business, which accounts for about a quarter of our premiums, is up 16% in euros, over 20% at constant exchange rates. Tenon Life combined ratio is now 93%, down 2.6 points with a strong reduction in the claims ratio to 66% and an excellent 27% expense ratio. The net result is up nearly 24%, reaching $570,000,000 with an adjusted return on equity of 13.3%. Our capital base remains strong despite market volatility, with shareholders’ equity at CHF8.5 billion and the solvency ratio at 205.6% at the March, in line with our target. The main rating agencies recognize our financial strength as seen with the recent change in our outlook by Standard and Poor’s to positive following Fitch’s action last March.
The implementation of our strategic plan is progressing and core businesses are performing extremely well. Overall, Iberia has an excellent contribution to results with €239,000,000 up 42.4%, thanks to its diversified business mix with Motor now in positive territory as well as a strong contribution from General Property and Casualty and the Life business. We have made significant strides in technical management with the motor combined ratio improving by eight points to 98.4%. In LatAm, performance has been outstanding and most countries now have combined ratios below 100% and improving, except in hyperinflationary markets. The largest challenge we are facing in the region right now is currency volatility.
We have been operating in these markets for many years and are confident that our diversified business model will continue to prove resilient. Brazil has had an excellent quarter with a net result of CHF 131,000,000 and there have also been important contributions from Mexico, Peru and Colombia. Both the Non Life and Life businesses are highly profitable and financial income continues to be a tailwind. The region reported a total result of million, up 10%. North America is reporting one of its highest half year results with EUR60 million, up 48%.
Technical measures are paying off with a relevant improvement in motor and solid profitability in generally property and casualty. Finally, in MAPFRE RE, a prudent approach to underwriting, diversification and retrocession continues to deliver solid results. We continued increasing prudence during the quarter with our reserves in the upper end of our confidence interval. This is due to a conservative approach as we go into the second half of the year. Performance was strong with a net result of million and a combined ratio under 96%.
In conclusion, these results are quite strong. And I will now hand the floor over to Jose Luis to walk us through the details. Jose Luis, please.
Jose Luis Jimenez, Group CFO, MAPFRE: Thank you, Jose Manuel, and good afternoon. Before moving into the details of the local figures, I would like to briefly comment on the main KPIs under IFRS compared to local GAAP. Insurance revenue, which reached a little over EUR 13,000,000,000, is up over 3%. The net result stands at CHF $596,000,000 under IFRS, 26,000,000 higher than local GAAP. IFRS 17 had a CHF 62,000,000 positive impact.
Positive yield movements and other adjustment offset a small impact from the loss component. IFRS nine had a negative CHF 36,000,000 impact due to the realized gains on equity recorded on the OCI as well as a slightly negative mutual fund valuation impact booked in P and L. Shareholders’ equity amounts to EUR 8,900,000,000.0, with similar trends as on the local GAAP. The gross TCM was €2,500,000,000 €1,600,000,000 after tax and minorities, and has been relatively stable during the year. The 91% combined ratio under IFRS has improved, down 2.5 points.
The return on equity stood at over 12% under IFRS. As you can see, most IFRS figures are very aligned with trends under local accounting. Further disclosure can be found on the nexus of the presentation and are available in our half year accounts on our website. I will now discuss the key trends by region under local accounting, complementing the figures already provided by Jose Manuel. In Iberia, total premiums are growing 13% with strong trends in most line of business.
Non life is up nearly 5% and life premiums are up 34%. The combined ratio has improved over four points to 96%. The returns on the investment portfolio continued to boost profit. The return on equity is now around 14%. Profitability in LatAm has been excellent, with a return on equity over 18%.
Brazil continues to see excellent results, posting a return on equity of over 27%, with improved technical ratios and high investment returns. The Non Life combined ratio is around 72%. Local currency, business volumes were flat with Life and Agro segments still affected by higher interest rates and the macro and geopolitical context. Premiums in euros are down 11% with a strong impact from the Brazilian real. Ode Latam continues to show strong profitability, contributing almost EUR 93,000,000, up 13% with technical improvements across the region, with an almost 4% reduction in the combined ratio to 95%.
Premiums are up 3% in euros, with most countries growing in local currency. North America, premiums are down 1% in euros, impacted by U. S. Dollar depreciation. The combined ratio is 96.5%, improving around three points, driven by underwriting measures and significant tariff increases implemented in recent years.
In EMEA, losses are down significantly, especially in Germany, offsetting the Turkish leader depreciation. The region is now reporting a 3,000,000 profit compared to an €8,000,000 loss last year, with a six point reduction in the combined ratio. Regarding Jose Manuel regarding MAPFRE RE, Jose Manuel has already gone over the main figures. In terms of growth, premiums are up around 1%. The U.
S. Dollar is relevant for the business, and premiums will be up nearly 5% at constant exchange rate. I will also like to comment that the main event were the California wildfires in the first quarter, which had an EUR 84,000,000 net impact in REE, with little change in the second quarter. Additionally, reformers of reserve had a 4.5 impact on the combined ratio. Modi continues to contribute positively.
Lastly, I would like to address two specific items. Hyperinflation adjustment has improved from around CHF 36,000,000 last year to CHF 60,000,000 this year, mainly due to Argentina. As a reminder, last year, there was a CHF 25,000,000 positive tax impact, which mainly affected the holding and, to a lesser extent, the Iberia business. General P and C lines remain strong across all markets, benefiting from technical discipline, strong market positions and diversification. Premiums are slightly down, affected by currencies, and the combined ratio is excellent, around 81%.
In Iberia, premiums have risen by nearly 6%, with growth in most segments and strong performance in Commercial Lines. The combined ratio was fairly stable at 95%. In Brazil, premiums are down 7% in euros but growing 5% in local currency. Agriculture issuance is still affected by the macroeconomic and geopolitical situation, while all the retail and industrial lines are experiencing notable growth. The combined ratio has improved to 63.4%.
This excellent level is supported by the solid AGRO ratio, which is down year on year and in the low 50s, with a lack of relevant events as well as strong performance in other retail lines. In North America, premium growth is impacted by the dollar depreciation while stable in local currency, supported by prior year tariff adjustments and other technical measures. Regarding Motor, first half results confirm the turnaround seen in the first quarter. The combined ratio is now around 99%, with a five point improvement year on year. And the net result is 89,000,000 compared to CHF 19,000,000 losses last year.
In Iberia, the combined ratio is now around 98%, and these positive trends should continue. Premiums are growing almost 4% and reflect average premium growth of nearly 8%. In Brazil, premiums are down mainly due to the currency depreciation. The combined ratio is stable, slightly under 102%, in line with higher interest rates. Performa has been spectacular in North America with a EUR35 million profit, more than double last year, with the combined ratio down 3.5 points to 97.5%.
Regarding other regions. In Northern Latam, almost all units now reporting combined ratios below 100%. In EMEA, the combined ratio is also down six points from around 120 to 113.6. In conclusion, the technical measures implemented are now clearly playing off. Regarding the Life business, premiums are growing 50%, thanks to Iberia, as well as strong trends in Odolatam, especially Mexico.
The Life business contributed €130,000,000 to the result. In Iberia, total premiums are up 34%, thanks to exceptional savings issuance. There was one large corporate policy issued during the quarter, but excluding this special transaction, growth was still around 18% in Iberia, around 8% for the group on the back of a strong retail business. The protection business is in line with previous trends. The net result was CHF 60,000,000, which is down year on year mainly due to the lower financial gains.
In Brazil, premiums are down around 80%, impacted by the currency as well as the high interest rates, which affect lending and related insurance sales. Profitability continues strong. Regarding the rest of the countries, volumes were up over 11%, led by Ode Latam. Performance in both Mexico and Malta has been noteworthy, growing 3840%, respectively. Now I will hand over to Felipe to discuss the main balance sheet items.
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: Thank you, Jose Luis. Shareholders’ equity stands strong at around 8,500,000,000 very stable since the beginning of the year. The improved valuation of the available for sale portfolio offset the negative currency conversions differences, mainly from the U. S. Dollar, which has depreciated 11.8% in the year.
Leverage was around 22%, below the 24 framework we announced at our AGM, reflecting our disciplined approach to capital and debt management. Total assets under management stand at over EUR61.5 billion, euros with growth in third party assets, especially in Brazil, which are now around €15,000,000,000 and we remain one of the leading non bank players in the asset management business. Our own investment portfolio reached over €46,000,000,000 with assets allocation stable. Our portfolio’s defensive nature, high liquidity and focus on quality and diversification allows us to confidently navigate the current market environment. On the top left, you can see our main fixed income portfolios, where most portfolio yields are still below the reinvestment rates.
Regarding the Euro area, yields are flat year to date. If we exclude linkers, the yields in the Non Life portfolios would be 10 to 15 basis points higher. In other markets, portfolio yields in Brazil are significantly up, nearly two twenty basis points year to date, reaching over 12.5%. In other LatAm, yields are slightly down, while in North America, they are moving up. Non life net financial income is down around 2%, with higher yields helping offset currency depreciation.
Although LatAm has been affected by Argentina, where investment returns are lower than prior years when hyperinflation adjustments were higher. On the right, you can see net financial gains around EUR 32,000,000, flat year on year. Iberia was the largest contributor with EUR 25,000,000, the majority coming from Non Life. Now I will hand the floor over to Jose Manuel to make a few closing remarks.
Jose Manuel Inchiausti, Vice President, MAPFRE: Thank you very much, Felipe. Before moving on to the Q and A, I would like to reiterate, as you have seen, that 2025 has been a good year so far for MAPFRE, and we are consolidating significant improvements across the group, especially in the Motor business. This is proof of our ability to adapt and thrive in challenging markets. Diversification continues to be one of our strongest assets, which not only mitigate risk, but allow us to leverage opportunities. We continue moving forward with execution of our strategic initiatives with focus on continuous technical improvement and profitable growth.
These are times of geopolitical and economic uncertainty, and we are aware of those headwinds. We move into the second half of the year with a positive outlook. We are prepared to face the headwinds from currency depreciations, inflation and economic growth, and we are confident in the direction we are heading in. I will now hand the floor over to Leandra to begin with the Q and A. Leandra, please.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Manuel. Although most of you are familiar with the process, as a reminder, you can use the Q and A tool at the bottom of your screen. We will organize the questions by topic and answer them as time allows. The first questions, we’re going to start with the Iberia business.
Jose Luis Jimenez, Group CFO, MAPFRE: We
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: received a question regarding the general P and C business in Iberia. Max from JB Capital would like to know why has the general P and C combined ratio improved despite the impact of the blackout on home insurance this quarter? What was the reason behind this improvement?
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: Okay. During this first quarter, I mean, we can say that we flagged a one off provision in conditional measures, which had a three to four point impact in the first quarter. Excluding this impact, the ratio would be similar, very similar of levers for burial. So that was the main impact on the P and C.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Felipe. We’ve also received another question from regarding the Iberia business and motor from Juan Pablo at Banco Santander. He’d like to know about the evolution of the vehicle fleet. Could you give us a bit more color on the fall of the number of vehicles insured? When do you think this could stabilize?
And how do you see pricing evolving?
Jose Manuel Inchiausti, Vice President, MAPFRE: I take the first part of the question. We don’t we are not leading, we are not measuring policy the number of policies in a given line of business. What we are seeing is the tendency of the customer, the number of customers that we have in MAPFRE. In that sense, the number of customer has got a non material variation during the year. It’s true that retail customers has been dropping a little bit.
But on the contrary, self employed customers and company customers has been improving and growing. So overall, the variation in customer has been non material.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. We have another question.
Jose Manuel Inchiausti, Vice President, MAPFRE: No, sorry, this is for
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: I think that we need to see what kind of trend we are going to have in the market. I think that the general movement of the market is together with MAPFRES in the same lines. So we could expect that we are going to move along together with the market and probably benefiting from the price increase that we did in the past in order to have through the to feed into the profit and loss when those premiums are earned.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Felipe. We have a follow-up question, I think, on this coming from Max. When do you expect the end in losing clients to finish in Iberia? Is it still related to a lower appetite for new business?
Jose Manuel Inchiausti, Vice President, MAPFRE: No, it’s not related to lower appetite for new business at all. We are competing well in new business, although we are not a price company. We are a service company.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: One second, we’re having a connectivity difficult. Dave, one second. Regarding the fall in the motor portfolio?
Jose Manuel Inchiausti, Vice President, MAPFRE: And regarding
Jose Luis Jimenez, Group CFO, MAPFRE: Maybe we could jump to the next question.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Yes, think we’re just going to wait one second. One second, please.
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: We can jump to the next question, Leandra.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: I think that would be better. I think we should move on to the question from Max Maschim from JB Capital. Were there any one offs in the combined ratio in Motor in Spain and North America? What is the reason for this increase?
Jose Luis Jimenez, Group CFO, MAPFRE: Well, in Spain, we saw some impact from Helmstone during the quarter, which had an around one point impact in 2Q stand alone and zero five point on the accumulated ratio at June. Regarding The U. S, no significant one off. That’s all.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. Moving on to the next question regarding life insurance in Iberia from from Max. It’s been a particularly strong quarter. Is there any particular reason for this? What should we expect for the remainder of the year in 2026?
Jose Manuel Inchiausti, Vice President, MAPFRE: I take it. As Jose Luis has said, Iberia had a contribution for our corporate customer. But without this contribution, growth has been 18% in Iberia. Our main assets in the life insurance business in Iberia is a very extensive network. We have 10,000 people selling life insurance in Iberia and 30% of them are allowed to sell more complex products like investment funds.
And the other asset is a very good products coming from our asset management company. So that means that we can have a positive outlook for the rest of the year.
Jose Luis Jimenez, Group CFO, MAPFRE: And if you allow me to say something on top of this, I think we are seeing as well less competition from banks in this sector. So we see this an incredible opportunity for us due to our extended network across Spain with more than 3,000 branches to try to capture those customers, those savers. They are trying to look for some interesting products out there.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. Okay. I think we’ve recovered our connectivity. So we’re going to go on to the next question from Carlos Peixoto. He’d like us to know about the different improvements in general P and C across all geographies.
Was there any release of reserves?
Jose Luis Jimenez, Group CFO, MAPFRE: Regarding reserve, it’s extremely easy. No release at all. And the improvements on P and C is something that we have been working for, I would say, the last two years. We have, in some cases, high tariff compared to previous years. In other cases, we have really good weather compared to all the seasons.
But I would say, overall, this is the technical measures that we have implemented during the last quarters.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. We have another question coming from David Barma, Bank of America. Brazilian agro was very strong in the second quarter. Now how much of this was luck, thanks to weather, versus an underlying improvement in the business?
Jose Luis Jimenez, Group CFO, MAPFRE: Well, regarding Brazil and the agro business, we are aware it is at minimum, and it’s reasonable to expect a correction but confident it will remain a highly profitable business. The level is supported by the diversification of the portfolio, sold as an insurance package, including life protection, 40% of the premium as well as property and crop insurance. On the other hand, from the investment portfolio with the SELIC at 50%, I think we have a strong backwind that probably could support us. But right now, we have to say, and this is the truth, there is a lot of uncertainty out there, we have pointed out, a lot of geopolitical risk. We have to see what’s going to happen with this 50% rise in tariff coming from The U.
S, if this finally materialize or not. So probably the most prudent approach is, well, we are seeing this for, I don’t know, maybe two years, but at some point, this should deteriorate a bit. But for the time being, it continues with a very good profitability.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. And staying on the same topic, what do these recent changes in the agro business involving lending in Brazil, what impact are they going to have on your top line going forward?
Jose Luis Jimenez, Group CFO, MAPFRE: Well, this part of the business is extremely linked to credit. And as long as we have high rates, I’m sure it will suffer a bit. So the good news is probably by the beginning of next year, we start to see that the Selix reduce the rate maybe from 15% to 12% or 10%, I’m sure they will help us to sell more policies. But for the time being, I mean, has been really challenging to do so with the SELIC. I think it is the most real interest rate in the world right now.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. Moving on to the next question, again from David Barma. He’d like to know why the earned premiums in Brazil are still holding up so strong despite the FX headwinds. What’s driving this? Maybe just a comment.
The net premiums earned reflect more the performance of the gross written premiums from the previous year than the premiums being issued this year. We can look into the exact numbers after the call, but it’s going to be largely reflecting different exchange rate movements. We have another question coming from Max. I think it was already covered. Again, he’s asking about the combined ratio in Brazil and that it was surprisingly good.
I think we covered that with the agro question. And I think we can move on to one more general strategy question that we’ve received from Juan Pablo de Banco Santander, and he’s asking about the the ROE. He says that we’ve reported an ROE over 12%, and you announced an up reviewed upward target in the March AGM of 11 to 12%. Is there room for positive surprise regarding the ROE?
Jose Manuel Inchiausti, Vice President, MAPFRE: Thank you very much. Just to remind that ROE is 13.3 net of write off that we did in Germany in German balance. So as that write off will be diluted during the year, the ROE must improve. On the other hand, we still have half a year in advance. And so we are stick to the target of 11 or 12%.
And then we will see if that improve or not at the end of the year.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Manuel. Moving on to another type of question. Paco Riquel is asking about the evolution of financial income in the second quarter of the year, in particular in LatAm. Were there any what offs one offs? I think he may be referring to the move in financial income in other LATAM that we saw from year on year.
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: But it was related with Argentina’s hyperinflation compensation that was affecting in the past. It was much higher compensation from the much higher inflation effect in the past in Argentina that was offset with financial income. And now that Argentina’s effect on the hyperinflation is much lower, we are going to see naturally how this financial income is less necessary to offset this kind of effect. So it’s totally natural and totally evolving in the same line of those two effects compensating one each other.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Felipe. We also received a question from Paco Jada, Banco Sabadell, regarding the combined ratio in Motor in North America, that it’s up between Q1 and Q2. And you’re also seeing premiums slowing down in local currency in North America. Can you give some color on this evolution?
Jose Luis Jimenez, Group CFO, MAPFRE: I mean, both questions are related to The U. S. Yes. Starting by the last one. There is no one off in the North American motor combined ratio.
And probably, if premium has slowed down a little bit in the second quarter, I think it’s more or less the trend in the market, but nothing specific related to it.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. I think we have one final question from Max at JB Capital regarding the outstanding performance in general P and C in the combined Well,
Jose Luis Jimenez, Group CFO, MAPFRE: would say it’s a combination of a lot of hard work for our colleagues there in The U. S. In terms of technical measures. And also, we have had as well some quite benign weather as well compared to other years. But nothing special, nothing that we could say this for the reason or that reason.
Overall, I would say it’s technical measures that have been implemented implemented really well.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. We just received a new set of questions. One is from Juan Pablo at Banco Santander regarding the reinsurance business, Montfri Re. He said results were very strong, and he noticed a strong year on year increase both in the financial result as well as the Life business. How do you see the coming quarters in the Reinsurance business?
Jose Luis Jimenez, Group CFO, MAPFRE: Probably, we will see we will continue the trend. We look at this in a very optimistic way. It is true that we are entering into the hurricane season and we prefer to be prudent. This is one of the reasons that we have increased slightly our reserving. But I don’t know the picture.
If the trends continue, I think it’s optimistic.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Jose Luis. David, Bartima had a follow-up question on that. I think you’ve touched on the main points. Just what exactly is driving this reserving prudence in reinsurance? And do you expect it to continue in the following quarters?
Jose Luis Jimenez, Group CFO, MAPFRE: Well, in case of that, we prefer to be extremely prudent. We have had a very good semester. We are entering right now the most tricky season. We hope for the best, but we prefer to prepare for the worst. And this is one of the reasons that we prefer, as always, to be prudent to increase reserve, but nothing specific at all.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. We’ve just received a question again from Juan Pablo in Santander regarding the Solvency II ratio. That was slightly down quarter on quarter. Could you give us a bit more detail regarding the moving parts? I think it was a very limited move quarter on It
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: was something really very limited. And I think that there were so many factors that are moving parts on the solvency ratio that we could consider that is quite stable quarter on quarter. I mean there will be some slight movements on the equity that is allocated on the movements on the different risks that are considering this ratio. But at the end of the day, what we see is a lot of stability on a quarterly basis and that is what we should read on this solvency level.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you, Felipe. We received another question from Max at JBL Capital. He would like to know how much was this large corporate policy in Iberia. I think in the call, we gave the numbers of growth with and without it.
Jose Luis Jimenez, Group CFO, MAPFRE: Absolutely. But in order to be more transparent, I would say it was around EUR 300,000,000, the corporate policy. But without this policy, growth was still around 80% in Iberia. I think it’s quite an outstanding growth compared to the sector.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Perfect. Thank you. We’ll send out the exact figures after the call, if that’s okay. Thank you. One And final question from Paco Jada, Bank Sabadell.
We saw a slowdown in local currency growth during the second quarter, both in Latin America and The United States. Is there anything we can comment on that?
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: There is nothing that we can comment. I think that the differences on the growth on different countries will depend very much on the situation of each of the countries. Right now, it’s more related with geopolitics that we’re playing and making its hit in the different currencies. The situation on the interest rates and how central banks are protecting their currencies is very much related with acceleration or deceleration of different economies. And what we should expect is that once we have a more clear future about this geopolitical situation, we will see we will may see a trend that it will be much more clear on the future quarters.
But what we see is what we get on these regions.
Jose Luis Jimenez, Group CFO, MAPFRE: And probably adding more light to Latin America, I will differentiate between Ode Latam, which was growing around 10% despite the currency movements. And probably the big country, Brazil, where with the Selic at around 15%, it is, I would say, normal that the activity, I would say, you put some brakes on it because it’s quite difficult overall with business related to credit to continue growing double digit. But nothing, as Felipe has said, I mean, we have right now a lot of geopolitical volatility. We would like to see that probably next quarter all this tariff war has reached some kind of agreement at some point. And probably we could come back as business as usual.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. Before handing the floor over to Jose Manuel to close the presentation, just a few quick reminders. We’ll be holding a virtual call next Wednesday afternoon for any follow-up questions, which will be hosted by Felipe Navarro and myself, together with the IR team. If you haven’t received the invitation or the dial in details, please let us know. And you can also contact us with any questions you have after the presentation today.
Thank you. And I’ll now hand the call back over to Jose Manuel.
Jose Manuel Inchiausti, Vice President, MAPFRE: Thank you very much. And just to have a final closing remarks, the first thing I would like to highlight that motor insurance is performing well. This is still room for improvement, but I have to highlight the sharp decrease in the combined ratio, especially in Europe and The USA. The second thing is to highlight once more that diversification is a big asset that MAPFRE has in regions, in number of countries and in the different business lines. And the other thing I would like to highlight is that almost every region or every region and every business line is going well.
This is given the level of diversification that we have is not a very easy thing to get. And first six months of the year has been so far very well in all the business lines and all the countries. And finally, just to remark that important IT, data and artificial intelligence plans are satisfactory being implemented in the main geographies. So we are optimistic on that side as well. Nothing else from my part.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you. Maybe Jose Luis and Felipe would also just say goodbye before we go on.
Felipe Navarro, Deputy General Manager of Finance, MAPFRE: Just thank everybody for this for being with us today and hope for nice holidays for everybody.
Jose Luis Jimenez, Group CFO, MAPFRE: That’s it. I trust you have all a happy holidays in the coming weeks and see you back on the next quarter.
Leandra Clarke, Head of Investor Relations and Capital Markets, MAPFRE: Thank you.
Jose Manuel Inchiausti, Vice President, MAPFRE: Thank you.
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