Q1 2010: Good investment return - customer buffers strengthened
(Thomson Reuters ONE) -
· Group result of NOK 278 million
· Good return on customers' assets
· Efficiency measures having expected effect
· Solid financial position and strengthened customer buffers
· Synergies SPP realised ahead of plan
The Board of Director's interim report for Q1 2010, Q1 2010 result presentation
and Supplementary Information are attached on http://www.newsweb.no
Storebrand will today host a press and analyst conference in Storebrands head
office at Lysaker, Professor Kohts vei 9, at 1000 CET (in Norwegian). An
international conference call will be hosted at 1600 CET. To participate in the
conference call please use link on http://www.storebrand.no/ir, or call in and
register 10 minutes before the presentation starts. Dial: +47 80080119 (from
Norway) or +47 23184501 (from Norway or abroad).
Full press release:
Q1 2010: Good investment return - customer buffers strengthened
· Group result of NOK 278 million
· Good return on customers' assets
· Efficiency measures having expected effect
· Solid financial position and strengthened customer buffers
· Synergies SPP realised ahead of plan
"Good returns for our customers, increased buffer capital and growth in new
sales sum up the first quarter. The improvement work in the group continues at
full strength, and will produce a gradually increasing effect over the year,"
says CEO Idar Kreutzer.
Sound value creation
The quarter's result was characterised by a good return on the customers' assets
within Life and Pensions. The customers' buffer capital was strengthened in the
quarter and amounted to NOK 5.9 billion and NOK 9.5 billion in the Norwegian and
Swedish life and pensions businesses, respectively.
The booked return in the quarter exceeded the average interest guarantee in all
customer portfolios in the Norwegian life and pensions business, and a NOK 1.3
billion market value adjustment reserve has also been built up.
The returns in the recommended investment choices for defined contribution
pensions in the Norwegian life and pensions business in Q1 were 2.1 per cent for
careful profile, 3.4 per cent for balanced profile, and 4.3 per cent for bold
profile, respectively. All profiles achieved higher returns than their
benchmarks.
SPP's result was positively affected by the implemented streamlining measures
and a good risk result in the quarter. The returns on investments in the
customer portfolios were good, which resulted in profit sharing between
customers and the owner. The financial result in the period was weakened by the
development of the interest rate market with the associated increase in the
value of insurance liabilities.
In connection with the acquisition of SPP annual synergies of NOK 470 million
related to revenue, costs, investments and tax were communicated. The synergies
are realised above target, 9 months ahead of plan.
The result in Storebrand Investments developed positively compared with the same
period last year, and was driven by an increase in assets under management from
internal and external customers, as well as the good development of the
financial markets.
The margins of Storebrand Bank's main products developed positively, but an
increased proportion of long-term funding and high liquidity costs weakened net
interest income. The development of losses and defaults in banking was
satisfactory, and the level of losses was substantially lower compared to 2009.
P&C insurance's result was negatively influenced by the segment's high claims
costs associated with the winter's extraordinary cold period.
Good customer growth
The net booked inflow of customer assets to Storebrand Life Insurance was NOK
1.6 billion in Q1 compared to NOK 1.1 billion in the same period last year.
Total new premiums (APE) in the Norwegian life and pensions business amounted to
NOK 826 million in the quarter, double the level in the same period last year.
New sales measured in APE in SPP increased by 3 per cent in relation to the same
period last year. New sales within unit-linked insurance increased by 7 per
cent. The increase in new sales took place at the same time as the number of
salespeople was reduced due to efficiency measures and restructuring in the
business.
SPP's strength within unit-linked insurance was confirmed by its naming as the
best unit-linked insurance company in Söderberg & Partners' annual ranking. This
is the second year in a row SPP has topped the list.
The net volume of new sales in the asset management business (external
discretionary assets and mutual funds) was negative in Q1. This development was
due to the fact that the company has lost some large interest rate mandates in
the institutional market. Sales are expected to develop positively in the rest
of the year.
Solid financial position
Storebrand was in a solid financial position at the close of Q1. The Storebrand
Life Insurance Group's solvency margin was 167 per cent at the close of the
quarter.
Storebrand ASA carried out new bond issues during Q1 worth a total of NOK 600
million with terms to maturity of 3 years. The company also repaid EUR 110
million of its credit facility meaning that this is now fully undrawn. The
company has also entered into an agreement concerning a new EUR 210 million
credit facility, which replaces the existing agreement. Overall the adjustments
increase the company's financial flexibility.
Norwegian pension reform
On 5 May, the Banking Law Commission will present proposed amendments to the
legislation regulating occupational pension schemes in the private sector. The
amendments lay the groundwork for the flexible drawing of pensions from
occupational pension schemes from the age of 62, at the same time as pension
points will continue to be earned if people keep working. The changes, which
will come into effect on 1 January 2011, will thus first focus on employees and
their options.
Storebrand is prepared for a higher inflow and greater need for advice from both
companies and employees, and has developed a new online advice tool.
Comprehensive information is also being provided to companies and employees with
occupational pension schemes in Storebrand.
Lysaker, 05 May 2010
Contacts:
EVP Corporate Communications Egil Thompson: Mobile (+47) 93 48 00 12
Head of Investor Relations Trond Finn Eriksen: Mobile (+47) 99 16 41 35
Enclosure: Board's Interim Report for Q1 2010
This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)
[HUG#1411876]
Supplementary_Information_Q1_2010: http://hugin.info/169/R/1411876/364233.pdf
Interim_report_Q1_2010: http://hugin.info/169/R/1411876/364232.pdf
Q1_2010_presentation: http://hugin.info/169/R/1411876/364235.pdf
Unternehmensinformation / Kurzprofil:
Datum: 05.05.2010 - 07:32 Uhr
Sprache: Deutsch
News-ID 20267
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