Key points in results:
- KLP delivered a result to its customers of NOK 5.7 billion for the whole of 2018.
- NOK 2.9 billion of the profits will be paid out to customers.
- Currently developing a pension platform to strengthen pension guidance and streamline operations.
The return on customers' funds was minus 1.4 per cent in the fourth quarter and 1.5 per cent for the whole of 2018. Falling stock markets left their mark on the return in the fourth quarter, while property and long-term bonds made positive contributions.
‘Troubled equity markets and rising interest rates in Norway and abroad characterised the result for 2018. Values were realised from previous good years that ensured a posted return of 0.4 per cent during the fourth quarter, and 3.5 per cent for the year as a whole. This means we are in a position to pay out a significant dividend to our customers,’ says Sverre Thornes, Group CEO.
KLP achieved a result for its public-sector occupational pension customers of NOK 5.7 billion for the whole of 2018. The company is leveraging this result to transfer NOK 2.9 billion into the premium fund and to boost its supplementary reserves by NOK 2.8 billion.
Market situation in the pension market
KLP has seen stable underlying growth in the premium reserve. The ongoing local government reforms have not yet resulted in any major changes to this situation.
The employer and employee organisations agree on the principles for changes to the public sector occupational pension. This scheme makes it easier to combine work and pension, and plan when oneself wants to retire. The changes in the pension scheme for public-sector employees will take effect from 1 January 2020.
‘KLP is well prepared to meet increased complexity as a result of regulatory changes and any new competition that may emerge. New pension regulations will provide greater freedom of choice to the individual, but will also create a greater need for information and advice. Requirements toward expertise and systems at the suppliers will increase. We are on schedule with establishing a new pension guide, where our members can simulate how different pension and work choices will impact their pensions,’ Sverre Thornes says.
Pension Platform of the Future
KLP has initiated a groupwide programme of change that will strengthen the company’s position in the market by exploiting technological opportunities. In order to succeed with this strategy, KLP needs a future-oriented pension platform that facilitates ongoing low costs as well as good service for customers and members.
‘The pension platform will form the basis of the best pension guidance service for employers and members, and contribute to a far higher degree of automation and efficiency than we have at present,’ says Sverre Thornes.
KLP refers also to the company’s interim report for the fourth quarter at klp.no
Key figures after the fourth quarter of 2018
Value-adjusted return on capital: 1.5 per cent
Book return on capital: 3.5 per cent
Premium income (excl. added reserves): NOK 38.7 billion
Pensions and other benefits paid (excl. transferred reserves): NOK 18.4 billion
Total assets, KLP Group: NOK 692 billion
For more information
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