Mandatum Life’s result for 2018: A strong year by many measures
Mandatum Life’s profit before taxes and premiums written both increased from the previous year.
Mandatum Life’s result before taxes for 2018 grew to EUR 450 million (236). The result includes a EUR 197 million transaction received in connection with a co-operation agreement that was concluded with Danske Bank in the second quarter of 2018. Comprehensive income after taxes, taking into account changes in market values, decreased to EUR 112 million (188). The return on equity was 8.7 per cent (13.3). The fair value reserve stood at EUR 352 million (599) at the end of December. The net return on investment assets amounted to EUR 232 million (376), excluding the return related to unit-linked insurance. Income from unit-linked insurance amounted to EUR –259 million (405).
The expense result reached a record-high level of EUR 35 million (33) in 2018. The risk result was EUR 33 million (35).
Premiums written on the company’s own account increased to EUR 1,074 million (960). Premiums written on unit-linked insurance grew to EUR 976 million (850).
Measured at market values, Mandatum Life’s investment assets at the end of December 2018 totalled EUR 5.6 billion (6.3), excluding the EUR 7.0 billion (7.1) in assets covering unit-linked technical provisions. The investment assets covering Mandatum Life’s original with-profit liabilities on 31 December 2018 totalled EUR 4.6 billion (5.2) at market values. The return on investment assets at fair values was –2.4 per cent (6.5) in 2018. The value of the investments covering the segregated portfolio was EUR 1.0 billion (1.1), and the return on the segregated portfolio’s investment assets at fair values was –1.9 per cent (1.8) in 2018.
Mandatum Life’s technical provisions stood at EUR 11.2 billion (11.6) at the end of 2018. Unit-linked technical provisions amounted to EUR 7.0 billion (7.1), representing 62 per cent (61) of the total technical provisions. The with-profit technical provisions decreased according to plan in 2018, and amounted to EUR 4.2 billion (4.6) at the end of the year. The insurance portfolios with a high technical rate of interest (4.5 and 3.5 per cent) shrunk by EUR 209 million to EUR 2.4 billion in the course of the year.
In 2018, Mandatum Life paid out a total of EUR 403 million (402) in pensions to approximately 65,000 pensioners. A total of approximately 50,000 other claims were also paid out.
Statement by CEO Petri Niemisvirta:
“2018 was an excellent year for Mandatum Life in terms of result. It was also a strong year for premiums written, with our customers entrusting us with a record-high volume of assets. Our expense result was also good. The investment result, however, remained rather weak due to the challenging market environment.
We concluded a new co-operation agreement with Danske Bank on 24 April 2018, and our work together has got off to a promising start.
In late autumn, we announced that we will be launching Mandatum Trader, a trading service based on Saxo Bank’s technology, in the first half of 2019. The service will help us expand our offering to a new area and enable us to serve both our existing and new customers even more broadly.
One aspect of 2018 that I am particularly pleased about is the satisfaction among our personnel and our customers. Ninety per cent of our personnel considered Mandatum Life a very good place to work. Similarly, our customer satisfaction was at a very high level last year compared to the rest of our business sector.”
Mandatum Life’s key figures 2018
Premiums written, own account: EUR 1,074 million (960)
Result before taxes: EUR 450 million (236)
RoE: 8.7% (13.3)
Solvency ratio: 176% (182), and without transitional measures 131% (127)
Return on investments: –2.4% (6.5) and on the segregated portfolio –1.9% (1.8)
Average number of staff: 531 (525)
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