Länsförsäkringar Alliance: Interim review January – September 2011

“The results trend for the non-life insurance operations has been moving in the right direction for several quarters now. We are continuing to focus on operating expenses to enhance efficiency. Extensive efforts are being made to reduce IT costs and clear results will be generated over the next few years. The improved technical result for non-life insurance, combined with higher profitability in the bank, was noted in low-risk operations. In these times of financial uncertainty, low risks and stable profitability in our underlying operations provide strong confirmation that we can meet the future with confidence. Our brand represents security and stability and we view these values as one of the reasons for an increased inflow of customers and high customer satisfaction. We have Sweden’s most satisfied retail bank customers, according to the 2011 Swedish Quality Index. Our life-assurance company’s key figures remain under heavy pressure. Measures are successively being implemented to strengthen the key figures and we can already see a slight improvement. The work on Länsförsäkringar AB’s acquisition of the unit-linked life assurance company, which is owned by Länsförsäkringar Liv, is part of this action programme and will be completed in the near future”, says Sten Dunér, President of Länsförsäkringar AB, the Alliance’s jointly owned company.

The period in brief

• The technical result from non-life insurance operations amounted to a profit of SEK 612 M (143). The improvement was due to higher volumes and favourable growth. The combined ratio was 100% (104), an improvement that was the result of increased volumes, although claims costs remained high since natural-disaster claims have adversely affected earnings in 2011.

• Extremely low long-term interest rates had a severe impact on the balance sheet and key figures of Länsförsäkringar’s traditional life-assurance company. The solvency ratio on September 30 was 112% (141 on December 31) and collective consolidation amounted to 108% (107 at December 31). To strengthen the traditional life-assurance company’s balance sheet and key figures, all saleable shares were gradually sold and the duration of the fixed-income portfolio was extended. The total return of the traditional life-assurance company amounted to 5.3%.

• Operating profit in the banking operations rose 7% to SEK 265 M (248) and net interest income increased 28% to SEK 1,244 M (973). Business volumes rose 8% to SEK 241 billion (223). The number of customers rose 8% to 871,000 (807,000).

Figures in parentheses pertain to 2010.

The Länsförsäkringar Alliance is neither a legal entity nor, in the legal sense of the term, a Group; it is an alliance between 23 independent regional insurance companies that jointly own Länsförsäkringar AB. Länsförsäkringar’s earnings from non-life insurance consist of the total of the earnings of the 23 regional insurance companies and of the jointly-owned Länsförsäkringar AB, excluding life assurance and banking. 

The full report is available attached.

For further information please contact:

Sten Dunér, President of Länsförsäkringar AB
Phone: +46 8 588 411 15

Christer Baldhagen, Director of Corporate CommunicationsLänsförsäkringarAB
Phone: +46 8-588 415 01

 
The Länsförsäkringar Alliance comprises 23 local and customer-owned regional insurance companies and the jointly owned Länsförsäkringar AB. Customers are provided with a complete offering of banking and insurance services through their local, regional insurance companies. We offer animal and crop insurance through Agria Djurförsäkring and total solutions for reliable mortgage transactions are offered through Länsförsäkringar Fastighetsförmedling.