Capital structure

As a result of the cancellation of shares repurchased under the share buy-back programme that was completed on 15 February 2019, the fully paid-in share capital of SRL as of 31 December 2019 amounted to CHF 32 740 470.40. It is divided into 327 404 704 registered shares, each with a par value of CHF 0.10.

The table below provides an overview of the issued, conditional and authorised capital of SRL as of 31 December 2019 and 31 December 2018, respectively.

More information is provided in the sections “Conditional and authorised capital in particular” and “Changes in capital” below .

Conditional and authorised capital in particular

Conditional capital for Equity-Linked Financing Instruments

The conditional capital of SRL as of 31 December 2019 was as presented in the table below.

The conditional capital amounts to CHF 5 000 000, permitting the issuance of a maximum of 50 000 000 registered shares, payable in full, each with a nominal value of CHF 0.10.

Such shares are issued through the voluntary or mandatory exercise of conversion and/or option rights granted by the company or Group companies in connection with bonds or similar instruments, including loans or other financial instruments (Equity-Linked Financing Instruments).

Existing shareholders’ subscription rights are excluded. The then current holders of the conversion and/or option rights granted in connection with Equity-Linked Financing Instruments shall be entitled to subscribe to the new registered shares. Subject to the Articles of Association, the Board of Directors may decide to restrict or exclude existing shareholders’ advance subscription rights with regard to these Equity-Linked Financing Instruments. Such a decision may be made in order to issue Equity-Linked Financing Instruments on national and/or international capital markets or by way of private placements in connection with (i) mergers, acquisitions (including takeover) of companies, parts of companies, equity stakes (participations) or new investments planned by the company and/or Group companies, financing or re-financing of such mergers, acquisitions or new in-vestments, or (ii) improving the regulatory and/or rating capital position of the company or Group companies.

If advance subscription rights are excluded, then (i) the Equity-Linked Financing Instruments are to be placed at market conditions, (ii) the exercise period is not to exceed ten (10) years for option rights and thirty (30) years for conversion rights, and (iii) the conversion or exercise price or the calculation methodology for such price of the new registered shares is to be set in line with the market conditions and practice prevailing at the date on which the Equity-Linked Financing Instruments are issued or converted into new registered shares.

The acquisition of registered shares through the exercise of conversion or option rights and any further transfers of registered shares is subject to the restrictions specified in the Articles of Association (please also see below). The maximum number of 50 000 000 shares to be issued under the conditional capital for Equity-Linked Financing Instruments corresponds to 15.27% of the existing share capital.

The availability of the conditional capital is not limited in time.

Authorised capital

The authorised capital of SRL as of 31 December 2019 was as presented in the table below.

The authorised capital amounts to CHF 8 500 000. The Board of Directors is authorised to increase the share capital of the company at any time up to 17 April 2021 through the issue of up to 85 000 000 registered shares, payable in full, each with a nominal value of CHF 0.10. Increases by underwriting as well as partial increases are permitted. The Board of Directors determines the date of issue, the issue price, the type of contribution and any possible acquisition of assets, the date of dividend entitlement as well as the expiry or allocation of non-exercised subscription rights.

The subscription rights of existing shareholders may not be excluded with respect to a maximum of CHF 5 200 000 through the issue of up to 52 000 000 registered shares, payable in full, each with a nominal value of CHF 0.10, out of the total amount of authorised capital.

The Board of Directors may exclude or restrict the subscription rights of existing shareholders with respect to a maximum of CHF 3 300 000 through the issue of up to 33 000 000 registered shares, payable in full, each with a nominal value of CHF 0.10, out of the total amount of authorised capital. Such exclusion or restriction relates to the use of shares in connection with (i) mergers, acquisitions (including take-over) of companies, parts of companies or holdings, equity stakes (participations) or new investments planned by the company and/or Group companies, financing or re-financing of such mergers, acquisitions or new investments, the conversion of loans, securities or equity securities, and/or (ii) improving the regulatory and/or rating capital position of the company or Group companies in a fast and expeditious manner if the Board of Directors deems it appropriate or prudent to do so (including by way of private placements).

The subscription and acquisition of the new registered shares, as well as each subsequent transfer of registered shares, shall be subject to the restrictions specified in the Articles of Association.

The maximum number of 85 000 000 shares to be issued under the authorised capital corresponds to 25.96% of the existing share capital.

Joint provision for conditional capital for Equity-Linked Financing Instruments and for the authorised capital

The total of registered shares issued from (i) authorised capital, where the existing shareholders’ subscription rights were excluded and (ii) from conditional capital, where the existing shareholders’ advance subscription rights on the Equity-Linked Financing Instruments were excluded, may not exceed 33 000 000 registered shares (corresponding to 10.08% of the existing share capital) up to 17 April 2021.

Changes in capital

Changes in 2019

The Annual General Meeting 2019 approved the reduction of the ordinary share capital by CHF 1 121 476.10 from CHF 33 861 946.50 to CHF 32 740 470.40 by cancelling 11 214 761 shares with a nominal value of CHF 0.10 each repurchased by SRL on a second trading line on the SIX Swiss Exchange, via Cantonal Bank of Zurich as agent. The 11 214 761 shares were repurchased under the share buy-back programme launched on 7 May 2018 until its completion on 15 February 2019. The purchase value of the repurchased own shares corresponded to CHF 999 999 983.08.

The reduction of the ordinary share capital could only take place after the required three notices to creditors had been published in the Swiss Gazette of Commerce (Schweizerisches Handelsamtsblatt) as stipulated in Article 733 of the Swiss Code of Obligations. The reduction of the ordinary share capital approved by the Annual General Meeting on 17 April 2019 was published in the Swiss Gazette of Commerce (Schweizerisches Handelsamtsblatt) on 16 July 2019.

On 17 April 2019 the Annual General Meeting authorised a public share buy-back programme for cancellation purposes consisting of two tranches of up to CHF 1 billion purchase value each for the Board of Directors to repurchase SRL’s shares prior to the 2020 Annual General Meeting. The first tranche of the programme was launched on 6 May 2019 and completed on 18 February 2020. The purchase value of the repurchased own shares corresponded to CHF 999 999 970.00. Together with the Q3/2019 results, which were published on 31 October 2019, the Board of Directors announced that it had decided not to launch the second tranche of the share buy-back programme due to the capital deployment, significant natural catastrophe losses in 2019 and the decision to suspend the initial public offering of ReAssure.

For further details on the share buy-back programmes, please visit: www.swissre.com/sharebuyback

Furthermore, the Annual General Meeting 2019 renewed the authorised capital (until 17 April 2021) and made further amendments to the provisions of the Articles of Association concerning authorised and conditional capital (re-setting several sub-limits, and amending the description of permitted cases of an exclusion of subscription or advance subscription rights).

Changes in 2018

The Annual General Meeting 2018 approved the reduction of the ordinary share capital by CHF 1 083 281.60 from CHF 34 945 228.10 to CHF 33 861 946.50 by cancelling 10 832 816 shares with a nominal value of CHF 0.10 each repurchased by SRL on a second trading line on the SIX Swiss Exchange, via Cantonal Bank of Zurich as agent. The 10 832 816 shares were repurchased under the share buy-back programme that ran from 3 November 2017 until 16 February 2018. The purchase value of the repurchased own shares corresponded to CHF 999 999 975.78.

The reduction of the ordinary share capital could only take place after the required three notices to creditors had been published in the Swiss Gazette of Commerce (Schweizerisches Handelsamtsblatt) as stipulated in Article 733 of the Swiss Code of Obligations. The reduction of the ordinary share capital approved by the Annual General Meeting on 20 April 2018 was published in the Swiss Gazette of Commerce on 24 July 2018.

On 20 April 2018, the Annual General Meeting authorised the Board of Directors to repurchase up to a maximum of CHF 1 billion purchase value of SRL’s own shares prior to the Annual General Meeting 2019 by way of a buy-back programme for cancellation purposes. The programme was launched on 7 May 2018 and completed on 15 February 2019. The purchase value of the repurchased own shares corresponded to CHF 999 999 983.08.

For further details on the share buy-back programmes, please visit: www.swissre.com/sharebuyback

Changes in previous years

Information about changes in share capital of SRL as well as of our former parent company Swiss Reinsurance Company Ltd for earlier years is provided in the Annual Reports of these companies for the respective years. For details please visit: www.swissre.com/investors/financial-information.html

Shares

All shares issued by SRL are fully paid-in registered shares, each with a par value of CHF 0.10. Each share carries one vote. The shares rank equally among each other in all respects (including in respect of entitlements to dividends and liquidation proceeds). There are no categories of shares with a higher or limited voting power, privileged dividend entitlement or any other preferential rights, nor are there any other securities representing a part of the company’s share capital.

The company cannot exercise the voting rights of treasury shares. As of 31 December 2019, shareholders had registered 167 993 029 shares with the share register for the purpose of exercising their voting rights, out of a total of 327 404 704 shares issued.

Profit-sharing and participation certificates

SRL has not issued any profit-sharing and participation certificates.

Limitations on transferability and nominee registrations

Free transferability

The company maintains a share register for the registered shares, in which owners and usufructuaries are entered.

The company may issue its registered shares in the form of single certificates, global certificates and intermediated securities. The company may convert its registered shares from one form into another at any time and without the approval of the shareholders. The shareholders have no right to demand a conversion into a specific form of registered shares.

Each shareholder may, however, at any time request a written confirmation from the company of the registered shares held by such shareholder, as reflected in the company’s share register.

The registered shares are administered as intermediated securities. The transfer of intermediated securities and furnishing of collateral in intermediated securities must conform to the Federal Intermediated Securities Act of 3 October 2008. The transfer and furnishing of collateral by assignment is excluded.

Persons acquiring registered shares will, upon application, be entered in the share register without limitation as shareholders with voting power if evidence of the acquisition of the shares is provided and if they expressly declare that they have acquired the shares in their own name and for their own account and, where applicable, that they are compliant with the disclosure requirement stipulated by the Financial Markets Infrastructure Act (FMIA) of 19 June 2015. The Board of Directors is allowed to remove the entry of a shareholder with voting rights from the share register retroactively from the date of entry if the entry was obtained under false pretences or if the owner, whether acting alone or as part of a group, has breached notification rules.

Admissibility of nominee registrations

Persons not expressly declaring in their application for entry in the share register that they are holding shares for their own account (nominees) are entered without further inquiry in the share register of SRL as shareholders with voting rights up to a maximum of 2% of the outstanding share capital available at the time. Additional shares held by such nominees that exceed the limit of 2% of the outstanding share capital are entered in the share register with voting rights only if such nominees disclose the names, addresses and shareholdings of any persons for whose account the nominee is holding 0.5% or more of the outstanding share capital. In addition, such nominees must comply with the disclosure requirements of the FMIA.

Legal entities or partnerships or other associations or joint ownership arrangements that are linked through capital ownership or voting rights, through common management or in like manner, as well as individuals, legal entities or partnerships (especially syndicates) that act in concert with intent to evade the entry restriction are considered as one shareholder or nominee.

The provisions of the Articles of Association restricting the registration of nominees as shareholders with voting rights may be amended or abolished by a resolution of the General Meeting of shareholders, which requires an absolute majority of the votes validly cast (see Shareholders’ participation rights).

Convertible bonds and options

Convertible bonds

As of 31 December 2019, except as provided below, neither SRL nor any of its subsidiaries has any bonds outstanding that are convertible into equity securities of SRL.

On 6 June 2018, SRL placed with the market via a repackaging vehicle USD 500 000 000 of six-year exchange-able notes, which may be stock-settled at the option of SRL. Subject to the conditions of the notes, noteholders may exchange their notes for ordinary shares of SRL at an exchange price of USD 111.6987 (adjusted from the initial exchange price of USD 115.2593). The exchange price is subject to further adjustment in certain circumstances described in the conditions of the notes. To economically offset the settlement of a noteholder-initiated exchange, SRL purchased matching call options on SRL shares with a portion of the proceeds. Consequently, no new SRL shares will be issued upon a noteholder-initiated exchange. The settlement and delivery of these notes took place on 13 June 2018. For further details please see Note 7. Assuming all of the notes were exchanged at the request of noteholders, 4 476 327 registered shares of SRL would have to be delivered (corresponding to 13.67% of the existing share capital).

Shares

Vesting of share awards to Swiss Re employees are physically settled (with treasury shares). The number of issued shares will not be affected. For details on shares granted to Swiss Re employees and for more information on the quantitative impact of vested shares please see Note 17 to the Group financial statements in this Financial Report. Assuming maximum vesting of all share awards granted as of 31 December 2019, 3 660 142 registered shares of SRL would have to be delivered (corresponding to 1.18% of the existing share capital).