Net profit rose to 2.5 billion Swiss francs (1.6 billion euros, 2.1 billion dollars) from 1.7 billion in 2003, beating analysts expectations that ranged from 2.1 to 2.4 billion francs.

Swiss Re managed the result despite a four-percent fall in premiums to 29.4 billion francs and the fact that 2004 was a peak year for catastrophes.

The reinsurer hiked its dividend by 45 percent to 1.60 francs per share, saying this reflected "confidence in its business direction as well as a very strong financial position".

Chief financial officer Ann Godbehere ruled out a share buyback for the foreseeable future, saying the group preferred to focus on "progressive" dividend increases and investing capital in growth.

Swiss Re sees "ample opportunities to put capital to work in the business," Godbehere told reporters in a conference call.

Acquisitions were also possible, although there were "no acquisitions on the radar screen at the present time," she said.

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