![]() (By last year, in a pitch for the IPO, it lowered its target to between $18 billion and $52 billion, per the Financial Times.) According to The New York Times, in 2018, JPMorgan was telling Neumann that it could find buyers to value the company at more than $60 billion while Goldman Sachs said $90 billion was a possibility, and Morgan Stanley - which has been assigned as lead underwriter of many of the buzziest tech offerings over the last decade - reportedly posited that even more than $100 billion was possible. Investment banks had reportedly courted WeWork’s business by discussing a variety of figures that led co-founder Adam Neumann to overestimate how it might be received by public market shareholders. You say to the company, ‘Well, if you can prove to us that the model actually does what it does, then it’s possible that the company is worth this in the public markets,'” Solomon said. Reuters was on the scene, reporting that Solomon acknowledged the process was “not as pretty as everybody would like it to be,” while also eschewing any responsibility, telling those gathered that the “banks were not valuing. Asked during a session at the World Economic Forum in Davos about WeWork’s yanked IPO in September, Solomon suggested it was proof that the listing process works, despite that the CFO of Goldman - one of the offering’s underwriters - disclosed last fall that the pulled deal cost the bank a whopping $80 million. The company remains the largest home and auto insurer in the U.S.It’s hard to put a positive spin on a terrible situation, but that didn’t stop Goldman Sachs CEO David Solomon earlier today. State Farm is Bloomington-Normal's largest employer, with over 13,000 employees. Supply-chain disruption, labor shortages, and costlier replacement parts are all contributing to current and future loss pressures. Personal auto has been a primary driver of the industry’s weak underwriting results, according to the Insurance Information Institute, an industry think tank. State Farm is not alone in facing challenges in the auto market. Auto makes up about 61% of State Farm’s insurance business. State Farm made money on homeowners’ insurance (underwriting gain of $849 million) and life insurance (net income of $588 million) in 2022. That was driven in part by a “noteworthy decrease” in State Farm’s stock portfolio and the big operating loss. ![]() It fell to $131.2 billion, down 8% from the year before. The company said it paid $7 billion in catastrophic loss claims. “The 2022 underwriting results reflect significantly higher auto lines incurred claims as well as higher homeowners non-catastrophe incurred claims and another year of catastrophe activity across the country,” State Farm said. State Farm said 2022’s heavy underwriting losses were driven by “rapidly increasing claims severity and significant additions to prior accident year incurred claims.” Many have accepted jobs with the outside firm, although an unknown number of employees were not offered jobs or chose to retire instead. State Farm recently announced plans to outsource much of its in-house IT operations – a cost-cutting move that’s expected to impact hundreds of employees. "We continue to adjust to these trends to make sure we are matching price to risk." Inflationary pressures and supply chain issues, combined with higher claim costs, are driving rate changes," a State Farm spokesperson said. "We are continuously monitoring and adjusting to trends. WGLT asked State Farm for more information about what those actions entail. “As we take actions to improve our operating performance, we look forward to helping more people in more ways as we begin our next 100 years,” Farney said. The Bloomington-based insurer releases its annual financial results around this time each year. ![]() State Farm’s annual operating results “were not at the level we expect as we consider each affiliate’s financial strength and long-term performance,” said Jon Farney, State Farm’s senior vice president, treasurer and chief financial officer, said in a statement Monday. That helped drive State Farm’s operating loss to $8.3 billion for its property-casualty companies in 2022 – after losing $313 million the year prior. That $13.2 billion in underwriting losses was the highest ever – almost three times more than what State Farm experienced in 2021 (-$4.7 billion). State Farm said Monday that it would “take actions to improve our operating performance” after eating a record $13.2 billion in underwriting losses in 2022 – in part because of costlier auto insurance claims driven by inflation. ![]()
0 Comments
Leave a Reply. |