PRESS RELEASE
20 October 2009
• Tapiola Pension’s return on investments at current value was 10.5% for 1 January to 30 September 2009 (-5.6% 1–9/2008). At the end of September, the market value of investments was EUR 8,238.5 million (EUR 7,299.3 million 12/2008).
• Nine-month investment income at current value was EUR 788.5 million (EUR -450.5 million 1–9/2008).
• Return by asset class: equities 29.8% (-25.0% 1–9/2008), fixed income securities 6.9% (2.0% 1–9/2008), and real estate investments 1.1% (2.6% 1–9/2008).
• The solvency ratio at the end of September was 21.9% (16.2% 12/2008), 3.4 times the solvency limit (2.9 12/2008).
“The record high return for the past nine months has already made up for the loss incurred in the challenging investment year 2008. The investment income for the first nine months of 2009 rose to EUR 788.5 million,” says Tapiola Pension’s Managing Director Satu Huber. The return from the beginning of 2008 to the end of September 2009 was +1.5%.
“Our investment strategy had the correct weightings. Allocation to credit and equities was increased during the period” explains Tapiola Pension’s investment director, Hanna Hiidenpalo. The period saw equity investments yield an exceptionally high return, and their proportion has risen close to 25 per cent of Tapiola Pension’s investments. The return on equities from 1 January to 30 September 2009 was 29.8% (-25.0% for 1–9/2008). During the same period, the European STOXX 600 index yielded a return of 25.9%. The return on bonds was 7.7% (1.8% 1–9/2008), which includes return on credit investments. Direct equity investments in the equity portfolio had a 42.0% return (-26.5% in 1–9/2008).
Tapiola Pension’s solvency is at a good level
Tapiola Pension’s solvency is back at a good level. The solvency ratio, which refers to solvency capital in relation to technical provisions, has risen to 21.9% (16.2% 12/2008). The solvency position is 3.4 (2.9 12/2008). Without the temporary changes in legislation, the solvency ratio would have been 17.0% (11.5% 12/2008) and the solvency position 2.7 (2.0 12/2008).
“Even though markets have yielded excellent returns in the first nine months of the year, there is much uncertainty associated with the development of the markets,” Hiidenpalo says. She explains: “Interest rates have reached an extremely low level, which has strongly increased allocation towards riskier investments”. A more permanent positive development in the market will require broad based recovery in the real economy.”
Premium income for the period under review came to EUR 1,039.9 million. Claims paid were EUR 951.0 million. Premium income was 2.8% down on the previous year’s level. This was caused by lower payrolls, due to the increasing unemployment rate.
The financial figures are unaudited.
Investments by risk category on 30 September 2009, PDF
Additional Information:
Tapiola Pension
Managing Director Satu Huber
+358 9 453 2619