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Investments in affiliated companies

Additions related essentially to capital increases at GGUS Investments Inc., New York (€ 77.8 million), GGIR Barbados (€ 39.9 million), GGG&Re London (€ 19.3 million) and several other smaller companies. Restruc- turing in North America resulted in retirements (€ 71.2 million) and additions (€ 73.3 million) as well as a moderate valuation gain.

Shares, investment certificates and other non-fixed-interest securities

The percentage of total investments relating to these classes of assets increased from 24% to 29% in the year under review. This is not an amount to a rise in the share ratio, however. The increased investment tended rather to be in fixed-interest-bearing funds; at 31 December 2001, the share ratio stood at 13.2%.

In a difficult stock market environment, current income from these classes of assets totalled € 32.0 million. As in previous years, the strate- gic focus of investment here was increasingly on Europe. This was for reasons of diversification. After a reduction of investment in New Econ- omy issues, investment in blue chips increased, especially in the second half of the year. Derivative financial instruments were used sparingly as risk management tools to help safeguard, consolidate or maximize the Company’s business interests. Speculative use was strictly ruled out. Looking at the year ahead, it is anticipated that if the US economy rallies and Europe follows suit, shares will be the form of investment yielding the highest return.

Fixed-interest securities

The lion’s share (€ 104.3 million) of total current income was again furnished by fixed-interest securities, although this investment segment was generally recessive.

For reasons of solvency, investment in securities is confined to invest- ment grade issues, the bulk of investment being in euro-based securities issued in Europe. Structured products were used to boost income to only a very limited extent.

50 Gerling-Konzern Globale Rückversicherungs-AG/Management Report

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