Munich Re’ s net profit fell in the first quarter, its chief executive on Wednesday, hit by low capital market interest rates that continue to weigh on investment income at the world’s largest reinsurer.

The company does not officially release quarterly results until May 8—however CEO Nikolaus von Bomhard told its annual shareholder meeting: “Net profit is likely to come in at around 900 million euros ($1.24 billion) in the first quarter.”

That would represent a drop of about 7 percent compared with the same period last year, when it posted net profit of 970 million euros.

The CEO’s comments weighed on Munich Re’ s shares, which fell 2.2 percent to 166.25 euros by 1145 GMT, the biggest decliner in the DAX index of German blue chip shares, which was flat. The STOXX Europe 600 insurance index fell 0.5 percent.

Analysts had expected quarterly net profit of 993 million euros, according to Thomson Reuters I/B/E/S.

“It would be nice to have a beat and this isn’t one,” said one insurance analyst, who declined to be named because of his bank’s policy.

Morgan Stanley cut its recommendation on the share to “equal weight” from “overweight” on Wednesday, he pointed out.

Von Bomhard reiterated Munich Re’ s goal of earning 3 billion euros in net profit this year and repeated that the target was “ambitious” in the face of sinking yields on the reinsurer’s stock of fixed-income investments.

The company posted net profit of 3.3 billion euros in 2013.

It felt increasing downward price pressure when annual reinsurance contracts with insurance firm clients were renewed in April, as pension funds and other specialised investors pour money into the reinsurance business, competing directly with traditional resinsurers like Munich and Swiss Re.

“It has been a long time since we’ve seen such intense competition,” von Bomhard said. “However, we’ve also seen that Munich Re has been less affected by these cyclical market movements than the overall market has,” he said, citing the reinsurer’s close relationship with its insurance company customers and its ability to deliver tailor-made reinsurance solutions as important strengths.