Shares in Zurich Financial Services, which owns Eagle Star and Royal & Sun Alliance in the Republic, fell 20 per cent yesterday after the Anglo/Swiss insurer wrongfooted the market by reporting a drop in earnings and by warning that this year's results would be even lower.

Although Zurich's shares had already fallen sharply after the group issued a profits warning last month, the 5.5 per cent drop in last year's normalised income to $2.1 billion (€2.4 billion) was slightly worse than had been flagged.