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Hannover Re strengthens equity base

Hannover, 17 December 2002:

Hannover Re's subsidiary E+S Rück, bearing exclusive responsibility for German business within the Group, yesterday successfully completed the capital increase announced in October. The capital stock of E+S Rück has been increased from EUR 30 million to EUR 42.6 million through the issue of 22,443 new no-par-value registered shares. Including a share premium of EUR 287.4 million, the total capital increase amounted to EUR 300 million. Hannover Re, as the parent company, currently holds a 56.8 % participation in E+S Rück, while 41.7 % is divided between seven highly reputed German mutual insurers. Over the past 18 months Hannover Re has already boosted its equity base on several occasions.

These measures, in conjunction with the capital increase at E+S Rück, have strengthened the balance sheet of the Hannover Re Group by a total of approximately EUR 1 billion. Wilhelm Zeller, Chairman of the Executive Board of Hannover Re, explained: "With these capital resources the Hannover Re Group is well equipped to derive maximum benefit from the opportunities offered by the current treaty renewals and participate to the fullest in the strong upturn of the reinsurance markets". Whether or not - and if so to what extent - further capital measures will be needed next year due to the favourable business growth cannot currently be foreseen. However, in November an Extraordinary General Meeting of Hannover Re approved in principle a range of capital market options.