Q2 2003 results

"Storebrand achieved a strong improvement in earnings in the second quarter, and our financial condition strengthened. The group's operations are working well, and we also benefited from better conditions in the capital markets. The measures implemented are producing the intended results, and will be continued with undiminished force. Risk management remains a major priority, our focus on cost savings continues, and additional effort is being put into strengthening our marketing and distribution", comments Idar Kreutzer, Group CEO.

 

Idar Kreutzer points out that the market for long-term savings and life insurance will be a growth area in the years to come. "Storebrand is leading in this market, and we have committed considerable resources over recent years to developing and reinforcing this position. This commitment is now beginning to yield results", adds Mr Kreutzer.

 

Life insurance produces good earnings for its customers and owner

Storebrand Life Insurance reported a profit for its owner of NOK 286 million in Q2, giving a profit for the first six months of NOK 364 million. The life company's value adjusted investment return was 4.2% after the first six months, with a booked return of 3.2%. The improvement seen in the value of investments held as current assets includes unrealised gains of NOK 1,083 million, added to the market value adjustment reserve. Long-term investments in bonds classified as hold to maturity show an unrealised gain relative to book value of NOK 3,160 million. A high proportion of hold to maturity bonds secures a high and stable interest income going forward.

 

Storebrand Life Insurance generated good sales to the corporate market. Sales to the retail market were ahead of the same period last year. Storebrand Helseforsikring reported continuing strong performance, with a 78% increase in total premium income in Q2 compared to the same quarter last year.

 

Storebrand Investments generated a good relative investment return on its products. Figures for the year to date show that 74% of the mutual funds and external discretionary portfolios managed by Storebrand have produced a better return than their benchmark indices.

 

Considerable effort is being committed to improving Storebrand's distribution to the retail market. A separate unit, Retail Sales, has been established as part of Storebrand Bank. The unit is Storebrand's main distribution channel in the retail market. Market conditions for sales of savings products remain weak, but sales of personal risk products and life insurance savings products have shown an improvement since the start of the year.

 

Storebrand Bank reported a reduction in the volume of non-performing and loss exposed loans from Q1 to Q2, but the overall level remains high.

 

Continuing improvement at If

The improving trend seen for If continued in Q2. If reported a combined ratio for Q2 of 101.0% and 103.0% for the first six months. Storebrand's share in If's results represented a profit in Q2 of NOK 141 million as compared to loss of NOK 171 million in the same period last year.

  

 

Oslo, 13 August 2003

 

 

 

Appendix: Board of Directors' interim report for Q2 2003