According to the group, the profit was impacted by the one-offs in Nordea's third quarter results and the EUR 155 million negative profit item resulting from the distribution of an extra dividend in the form of Nordea shares. The comparison figure contains a non-recurring profit item of EUR 197 million related to Mandatum Life's co-operation agreement with Danske Bank.
The total comprehensive income for the period, taking changes in the market value of assets into account, amounted to EUR 879 million (1,142).
- Insurance premiums written: EUR 6,424 million (+6.8%), of which:
- If: EUR 3,717 million (+3.4%)
- Mandatum: EUR 831 million (+115.8%)
- Topdanmark: EUR 1,087 million (+13.3%)
- Net income from investments: EUR 1,947 million (+118.4%)
- Return on equity: 9.2% (-2.0 pp.)
- Return on assets: 4.5% (-0.1 pp.)
- Solvency ratio: 178% (+38 pp.)
- Profit before taxes: EUR 1,073 million (-34.7%)
- If: EUR 655 million (+4.6%)
- Mandatum: EUR 212 million (-44.9%)
- Topdanmark: EUR 180 million (+5.9%)
- Associates: EUR 164 million (-69.3%)
- Valuation loss on distribution of Nordea shares: EUR (155) million
Profit before taxes for January - September 2019 for the If segment amounted to EUR 655 million (9M2018: 626). The total comprehensive income for the period after tax rose to EUR 544 million (9M2018: 358). Combined ratio was 84.3% (9M2018: 85.8%) and risk ratio 62.8% (9M2018: 64.2%).
Net releases from technical reserves relating to prior year claims were EUR 159 million (9M2018: 129) in January - September 2019. The Swedish discount rate used to discount the annuity reserves was -1.0 per cent and had a negative impact of EUR 9 million on the profit in the third quarter of 2019. The negative impact for January - September 2019 amounted to EUR 38 million. Technical result increased to EUR 520 million (9M2018: 463). Insurance margin (technical result in relation to net premiums earned) amounted to 16.1 per cent (9M2018: 14.5%).
Large claims were EUR 17 million (9M2018: 19) worse than expected in January - September 2019. Large loss development in BA Commercial was EUR 11 million worse and in BA Industrial EUR 7 million worse than expected.
Gross written premiums increased to EUR 3,717 million (9M2018: 3,595) in January - September 2019. Adjusted for currency, premium growth was 5.0%. Growth was positive in all business and market areas. The growth was particularly strong in BA Industrial, 13.9% and in Norway, 9.1%.
Cost ratio amounted to 21.5% (9M2018: 21.6%) and expense ratio to 15.9% (9M2018: 16.1%).
At the end of September 2019, the total investment assets of If amounted to EUR 11.5 billion (9M2018: 10.9), of which fixed income investments constituted 82% (9M2018: 88%), money market 8% (9M2018: 2%) and equity 10% (9M2018: 10%).
Net income from investments amounted to EUR 158 million (9M2018: 182). Investment return marked-to-market in January - September 2019 was 3.7% (9M2018: 1.3%). Duration for interest bearing assets was 1.2 years (9M2018: 1.4) and average maturity 2.6 years (9M2018: 2.7). Fixed income running yield without taking into account the FX hedging cost as at 30 September 2019 was 1.6% (9M2018: 1.6%).
Mandatum segment's profit before taxes for January - September 2019 amounted to EUR 212 million (9M2018: 385). The comparable profit figure includes a contribution of EUR 197 million from the co-operation agreement made in the second quarter of 2018 with Danske Bank.
The total comprehensive income for the period after tax reflecting the changes in market values of assets decreased to EUR 224 million (9M2018: 232). Return on equity was 25.9% (9M2018: 22.5%).
Mandatum Life Group's premium income for January - September 2019 increased to EUR 824 million (9M2018: 681). Unit-linked premiums were EUR 720 million (87% of total premiums).
Net investment income, excluding unit-linked contracts, increased to EUR 280 million (9M2018: 196). Net investment income from unit-linked contracts amounted to EUR 680 million (9M2018: 130). In January - September 2019, fair value reserve increased to EUR 406 million (9M2018: 352).
Mandatum Life's total technical reserves increased to EUR 11.7 billion (9M2018: 11.2). Unit-linked reserves were at a record-high level of EUR 7.8 billion (9M2018: 7.0) at the end of September 2019. The amount corresponds to 65% (9M2018: 64%) of total technical reserves. By the end of September 2019, with-profit reserves had decreased to EUR 4.0 billion (9M2018: 4.2). Reserves related to the higher guarantees of 4.5 and 3.5 per cent decreased by EUR 198 million to EUR 2.2 billion (9M2018: 2.4).
Mandatum Life has overall supplemented its technical reserves with a total of EUR 227 million (9M2018: 232) due to low level of interest rates. The figure does not take into account the reserves relating to the segregated fund.
At the end of September 2019, Mandatum Life's investment assets, excluding the assets of EUR 7.8 billion (9M2018: 7.0) covering unit-linked liabilities, amounted to EUR 5.7 billion (9M2018: 5.6) at market values.
The investment return marked-to-market for January - September 2019 was 6.7% (1.4%). The duration of fixed income assets at the end of September 2019 was 2.7 years (9M2018: 2.5) and average maturity 2.8 years (9M2018: 2.8). Fixed income running yield without taking into account the FX hedging cost was 2.3 per cent (9M2018: 2.7%).
The expense result for January - September 2019 amounted to EUR 17.0 million (19.5) and risk result amounted to EUR 15.1 million (15.1).
Mandatum Life Insurance Company received a issuer credit rating of A+ from S&P on 18 September 2019.
More financial information about Sampo Group can be found at sampo.com/result.
Finland-based Sampo Group has a strong presence in Northern Europe financial and insurance markets, operating in Denmark, Norway, Sweden, Finland, Estonia, Latvia and Lithuania through 4 main financial companies: Sampo, If, Mandatum Life and Topdanmark.