Reasonable half-year result despite challenging market situation
Mandatum Life’s January–June result before taxes grew to EUR 103 million (81). The result grew, despite the challenges in the capital markets, and even though the technical provisions were supplemented further as a contingency for continued low interest rate levels. Mandatum Life’s solvency remained strong, taking into account the transitional measures.
The total comprehensive income for the period, taking changes in the market value of assets into account, amounted to EUR 44 million (144) after tax. The return on equity (RoE) was 6.5 per cent (21.8). The expense result was EUR 9 million (13) and the risk result was EUR 10 million (11).
Mandatum Life Group’s premium income on its own account in January–June shrunk to EUR 492 million (676). Mandatum Life’s market share grew and in Finland was 21.2 per cent (18.0).
Measured at market values, Mandatum Life’s investment assets, excluding the EUR 5.8 billion (5.9) in assets covering unit-linked insurance, totalled EUR 6.5 billion (6.7) at the end of June 2016. The assets covering Mandatum Life’s original with-profit liabilities on 30 June 2016 amounted to EUR 5.3 billion (5.5) at market values. The return on investments at fair values was 1.5 per cent (5.9) in January–June. The value of investments covering the segregated group pension portfolio that was transferred from Suomi Mutual in 2014 was EUR 1.2 billion (1.2), and the return on investments at fair values for January–June was 1.7 per cent (3.0).
Mandatum Life Group’s total technical provisions amounted to EUR 10.7 billion (10.9) at the end of June 2016, and the with-profit technical provisions decreased to EUR 4.9 billion (5.0). Insurance portfolios with higher guarantee with-profit reserves (3.5 and 4.5 per cent) were down by EUR 108 million, and altogether amounted to EUR 3 billion for the January–June period. Unit-linked technical provisions remained almost at the same level, EUR 5.9 billion, which was 55 per cent (54) of the total technical provisions.
In response to the low interest rate level, Mandatum Life supplemented its technical reserves by a total of EUR 232 million. The figure does not include the increase in the so-called segregated portfolio. The return requirement for 2016 has been lowered to 0.5 per cent; for 2017 it is 1.0 per cent and for 2018 it is 1.75 per cent. The discount rate for the segregated portfolio is 0.75 per cent.
Key figures H1/2016
Premiums written, own account: €492 million (676)
Profit before taxes: €103 million (81)
RoE: 6.5% (21.8)
Solvency ratio: 154% (12/2015: 158)
Return on investments: 1.5% (5.9) and on the segregated portfolio 1.7% (3.0)
Average number of staff: 541 (520)
The information concerning the products or services presented on this website is a general presentation and cannot be construed as an offer or as investment advice or any other advice to make a decision concerning an investment or insurance. The Customer must carefully familiarise him-/herself with the terms and conditions and brochures pertaining to the products and services, and, if necessary, obtain more information prior to making an individual investment decision or other decision concerning insurance. The information regarding legislation and taxation is based on Mandatum Life's understanding of the current legislation and taxation practices. The website contains material that is covered by intellectual property rights. All rights are reserved.
Read more »