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6.13 Shareholders’ equity and treasury shares
Shareholders’ equity is shown as a separate component of the financial statement in accordance with IAS 1 “Presentation of Financial Statements” and subject to IAS 32 “Financial Instruments: Disclosure and Presentation” in conjunction with IAS 39 “Financial Instruments: Recognition and Measurement”. The change in shareholders’ equity comprises not only the net income deriving from the statement of income but also the changes in the value of asset and liability items not recognised in the statement of income.
The common shares (share capital of Hannover Rück SE) amount to EUR 120,597,134.00. They are divided into 120,597,134 voting and dividend-bearing registered ordinary shares in the form of no-par-value shares. The shares are paid in full. Each share carries an equal voting right and an equal dividend entitlement.
Conditional capital of up to EUR 60,299 thousand is available; it can be used to grant shares to holders of bonds and / or profit-sharing rights with conversion rights and warrants. Authorised capital is also available in an amount of up to EUR 60,299 thousand. Both have a time limit of 9 May 2021; the subscription right of shareholders may be excluded with the consent of the Supervisory Board under certain conditions. The Executive Board is authorised, with the consent of the Supervisory Board, to use an amount of up to EUR 1,000 thousand of the existing authorised capital to issue employee shares.
The Executive Board is further authorised, with the consent of the Supervisory Board, to acquire treasury shares – including through the use of derivatives – up to an amount of 10% of the share capital. The authorisation has a time limit of 5 May 2020.
The Annual General Meeting of Hannover Rück SE resolved on 10 May 2016 that a gross dividend of EUR 4.75 per share should be paid for the 2015 financial year. This corresponds to a total distribution of EUR 572.8 million (EUR 512.5 million). The distribution consists of a dividend of EUR 3.25 per share and a special dividend of EUR 1.50 per share.
The increase in the other reserves arising out of currency translation, which is recognised in equity, was attributable in an amount of EUR 10.1 million (decrease recognised in equity of EUR 11.9 million) to the translation of long-term debt or loans with no maturity date extended to Group companies and branches abroad.
The disclosures on capital management arising out of IAS 1 “Presentation of Financial Statements” are provided in the “Financial position” section of the management report, to which the reader is referred. This includes both a presentation of our capital management objectives and procedures and a description of our policyholders’ surplus, together with a summary of the diverse capital requirements to which we are subject. The Solvency II regulatory framework, in particular, gives rise to capital requirements and consequences for capital management, which we discuss more closely in the risk report.
Treasury shares
IAS 1 requires separate disclosure of treasury shares in shareholders’ equity. As part of this year’s employee share option plan Hannover Rück SE acquired altogether 16,413 (12,922) treasury shares during the second quarter of 2016 and delivered them to eligible employees at preferential conditions. These shares are blocked until 31 May 2020. This transaction resulted in an expense of EUR 0.4 million (EUR 0.3 million), which was recognised under personnel expenditure, as well as a negligible change in retained earnings recognised in equity. The company was no longer in possession of treasury shares as at the balance sheet date.