KLP achieved a returns result (returns in excess of the average guaranteed rate of return) of NOK 4.6 billion after the third quarter. Value-adjusted returns on the customers’ assets were 6.6 per cent, while book returns ended at 2.7 per cent. Very good developments in equity markets and value increases on bonds are the main reasons for the good result.
“We are pleased to to present such strong results after the third quarter. The return on our customers’ pension fund is well above the return we have guaranteed, and our costs are low. The good result allows us to maintain our ambition to reduce our prices and thus expenses for our customers and owners,” says CEO Sverre Thornes of KLP.
Winning tender
Øygarden municipality chose KLP as its provider of public-sector occupational pensions from the new year. Here KLP won the first contract for an insurance-based pension solution to be put out to tender for seven years.
“This shows that we have spent the time well and delivered good services at a competitive price,” says Thornes.
As expected, the Storting adopted changes to the pension scheme for public-sector employees with effect from the end of this year. This contributes to increased complexity for our customers and members too. KLP is therefore investing heavily in solutions to guide both employers and their staff, which will lay the foundation for further streamlining their own operations.
Four new Nordic Swan-branded funds
KLP is finding that more and more customers are concerned and wanting a say in how their pension assets and other savings are managed. In the third quarter, KLP therefore launched four new Nordic Swan-branded index funds: two fixed income funds and two equity funds. These funds follow strict sustainability criteria in their investments. There are also criteria for monitoring companies and for transparency and reporting on the funds’ activities.
The new eco-certified funds will be available to all fund customers of KLP. For example, the Swan-labelled funds can be chosen by people who have defined-contribution pensions. The funds have very low management fees.
KLP Banken is one of 130 banks in the world to have signed up to the UN Principles for Responsible Banking. The bank rewards sustainable investments with green interest rates on loans and savings.
KLP’s green loans for environmentally friendly investments have been well received in the public lending market. Green loans totalling NOK 600 million have been granted so far. These are split 60 per cent to the water and waste sector and 40 per cent to climate-friendly new building projects.
KLP also refers to the company’s interim report for the third quarter at klp.no
Key figures after the third quarter 2019
Value-adjusted return on capital: 6.6 per cent
Book return on capital: 2.7 per cent
Premium income (excl. added reserves): NOK 32.2 billion
Pensions and other benefits paid (excl.transferred reserves): NOK 15.1 billion
Total assets, KLP Group: NOK 745 billion
For more information, contact:
Chief Executive Sverre Thornes: tel. +47 977 44 007
Group Chief Financial Officer/Executive Vice President, Finance Aage Schaanning: tel. +47 905 24 312
Finance Director Oliver Siem: tel. +47 934 31 820
Information Director Sissel Bjaanæs: tel. +47 932 56 350
Terms and concepts
Book returns
Returns on the customer funds that are allocated to the insurance customers annually. Comprises financial income from management of the customer assets in life insurance excluding the change in net unrealised added values from equity and bond investments.
Value-adjusted returns
All returns that have been achieved through management of the customer funds, including unrealised values.
Returns result
Returns on customer assets beyond the returns the insurer has guaranteed its customers.