An attempt to tell investors by QBE Insurance Group that there had been little if any damage to its finances by the recent market turmoil left the market unimpressed.
QBE shares bounced strongly in yesterday's recovery and at best the statement from the company confirmed what many had thought.
That the company was well managed.
QBE reaffirmed the current position of its investment portfolio amid the subprime market meltdown.
The shares traded up to a high of $28.75 before easing a little in line with the general market easing late in the morning. They ended 87c higher at $26.90
It was a sedate easing in the afternoon for QBE shares.
QBE shares had fallen from more than $33 to a 52 week low of $25.55 in Tuesday's sell-off.
So in reaction to that selling the group told the ASX in a statement that its equity portfolio of about $1.7 billion is protected through derivative hedges.
But QBE said it had indirect exposure to subprime issues via its investments and deposits in major banks. These were not quantified.
"These hedges, put in place in late April 2007, have ensured that QBE protected its net equity realised and unrealised capital gains in 2007 and has not incurred net realised and unrealised capital losses on its equity investments in the period since 31 December 2007," it said in a statement.
QBE added that its fixed interest and cash investment portfolio of about $23 billion was in "high quality" liquid securities with a short duration to maturity and no direct exposure to US subprime mortgage products.
"We have a small indirect exposure through our investments in and deposits with highly rated major banks," it said.
QBE's chief executive officer, Frank O'Halloran said in the statement the group regularly monitors investment market conditions.
"We will take the opportunity to enhance our investment returns in line with our strategy if we consider the market outlook is positive," he said.
QBE said it had received a number of enquiries from investors and others about the state of its equity and fixed interest investment portfolio.
But the company did not make any statement about trading conditions and how the 2007 earnings had gone and how it saw 2008.
It may have been the absence of those statements that led to a bit of wariness on the part of some investors yesterday.
