Sampo Highlights 2000 2 Group Key Figures 3 What is Sampo? 4 Key Information on Central Group Companies 4 Main Legal Structure of Sampo-Leonia 5 Chief Executive Officer’s Review 6
Leskinen resigned from his position with effect from 1 January 2001. The
Leonia Sampo Sampo Mandatum Bank *) Pank *) bankas Bank *) ***)
Strategic changes to be made in the Group were announced in January 2001. The Group’s name for the interim period is Sampo-Leonia, but the Board has proposed
In addition to the Sampo network, Mandatum Bank’s regional offices will offer the Group’s customers the specialised investment service of a private bank. Marketing efforts in the growth areas will focus particularly on our own customers. At the beginning of the current year when the new
The European Central Bank decided to raise its reference rate several times during the year. All in all, the reference rate rose by 1.75 percentage points to 4.75 per cent over the year. Money market rates began to fall towards the end of the year, as signs of slowdown in U.S. economic growth began to materialise and corresponding expectations for inflation were lowered. There was also a fall in equity prices.
Economic growth was approximately four per cent, the same as in 1999. Towards the end of the review period growth slowed down owing to high interest rates at the beginning of the year. Weakening inflation and the narrowing current account deficit caused interest rates to go down in the final months of 2000.
Sampo-Leonia’s life insurance maintained its market leadership in corporate insurance and significant growth was registered in group pension insurance in particular.
Sampo-Leonia’s new strategy gives high priority to the long-term savings area. This business area covers life insurance, funds and asset management.
Group in February 2001 and focus on asset management services, strengthen the investment service know-how of the service network further.
Leonia were combined so that customers can access both bank and insurance services on the same telephone service number and by using a single customer code.
tomers are served by their own sales unit whereas small and medium-sized companies are served from 74 corporate offices. The web services offer customers the opportunity to contact Sampo-Leonia 24 hours a day, and the service is complemented by telephone customer service.
Sampo Insurance Company plc and Leonia plc merged at the end of the year under review. The merger created the first Finnish full-service financial group. The Group has been further strengthened by Mandatum Bank Plc, which joined the Group in February 2001.
• The integration of the businesses of Sampo and Leonia fund management and asset management companies.
Development Bank’s balance sheet totalled EUR 45 million in 2000. The bank, which specialises in corporate finance, was renamed UAB Sampo bankas in February 2001.
Excluding accelerated depreciation on IT systems the profitability of non-life insurance remained at the level of the previous year. The combined ratio in the final accounts was 114.1 per cent (111.9%).
Non-life insurance balance on technical account by group of insurance class
The creditworthiness and the collateral ratings form the basis for measuring the total amount of credit risk. Credit decisions for corporate and institutional customers are based on the customer’s creditworthiness. To reduce uncertainty related to its estimation, covenants or collateral are required.
Particular attention has been paid in the introduction of new technology to avoiding the occurrence of breaks, malfunctions and security gaps. Risks are managed by using separate development and testing environments in version changes. The responsibilities for developing, testing, piloting and producing services have been clearly divided.
The annual accounts and consolidated accounts of the banking and investment service companies of the Group have been compiled in accordance with the provisions of Article 4 of the Act on Credit Institutions, decree (21.12.2000/
The consolidated profit and loss account and balance sheet have been compiled in accordance with the decision of the
The merger of Leonia plc and Sampo Insurance Company plc has in the accounts been implemented by using the pooling method of accounting. The difference between the nominal value of shares given as consideration and Leonia plc’s share capital and share premium account is presented in Sampo’s premium reserve. Leonia plc’s distributable capital is entered in Sampo’s contingency reserve. The same principle has been applied to the merger of Leonia Group’s
Shares and debt securities which are quoted on official stock exchanges or otherwise are subject of public trade, are valued at the latest available closing price or, if this is not available, at buying rate.
Provisions for bad and doubtful debts In banking and investment services, provisions for bad and doubtful debts consist of specific provisions made for loans and advances to credit institutions and customers, and for contingent liabilities and commitments and amounts written off these items.
Income and expenses of locked contracts are included in the result.
PER-SHARE KEY FIGURES: Earnings per share + profit before extraordinary items and tax
Other items of the solvency margin, including derivative contracts, has been deducted from/added to the valuation differences when calculating the key figures.
Provision for outstanding claims, 1 Jan. 2000 592 –29 562 Provision for outstanding claims, 31 Dec. 2000 568 –11 557
Impact of bonuses and rebates attached to life and pension insurance policies reserved during the year, on the technical result 141 43
Held for trading purposes 1 37 Held as financial fixed assets 3 –
The remaining acquisition cost of debt securities comprises: That difference between the amount repayable at maturity and purchase price, which has been released to interest income (+) or charged to interest income (-) 8 –10
Patria Reinsurance Company Limited Helsinki Finland 100.00 – 14 14 4 Industrial Insurance Company Ltd Helsinki Finland 100.00 100.00 42 176 370 Sampo Life Insurance Company Limited Helsinki Finland 79.90 44.97 245 342 162 ST International Insurance Company Limited Helsinki Finland 100.00 100.00 17 26 11 Vakuutusosakeyhtiö Vahinko-Sampo Helsinki Finland 100.00 100.00 2 2 0 Sampo Enterprise Insurance Company Limited Helsinki Finland 100.00 100.00 50 75 50 Vakuutusyhtiö Teva Oy Helsinki Finland 100.00 100.00 2 2 0 AS Sampo Eesti Elukindlustuse Tallinn Estonia 100.00 – 2 2 0 AS Sampo Eesti Varakindlustus Tallinn Estonia 100.00 – 14 10 3 UAB Sampo Lietuva Vilnius Lithuania 100.00 – 6 5 –1 AAS Sampo Latvija Riga Latvia 99.99 – 2 1 0 AAS Sampo Latvija Dziviba Riga Latvia 99.99 – 4 3 0 Lakewood Insurance Company Ltd London UK 100.00 – 0 4 0 Sampo Industrial Insurance N.V. Rotterdam Holland 100.00 – 28 25 –19 Norwich Union Towarzystwo Ubezpieczen na S.A. Warsaw Poland 100.00 100.00 48 13 –24 Sampo Towarzystwo Ubezpieczén Spólka Akcyjna Warsaw Poland 100.00 – 4 3 0
Procuritas Capital Partners II - B L.P. Sweden 5,428,824 – 6 6 Schroder Ventures European Fund UK 506,639 – 5 5 Schroder Ventures European Fund II LP2 UK 550,000 – 6 6
In domestic In foreign In domestic In foreign EUR million currency currency currency currency
Leonia Bank plc had no customer funds intermediated as credits to other customers at end of year.
Provision for outstanding claims (discounted part) Before discounting 30 47 After discounting –22 –35 Amount of discounting 8 11
Mortgages for own loans 2 2 – – Amount of the above loans 1 2 – –
Amount of joint liability pertaining to VAT group registration Group undertakings – – – 0 Associated undertakings – 0 – 0
Loss ratio Claims incurred to premiums earned (%) 83.3 89.9 90.3 84.7 75.8
Meeting, the members of the Board of Directors annually elect from among the members a Chairman and a Vice
Commerce and the Confederation of Finnish Industry and Employers in 1997.
Finance. He was appointed member of the Board of Directors of Sampo Insurance Company plc on 25 May 2000.
project to develop the management of strategic learning was initiated, and the intention is that the results of this work will be used from the beginning of 2001.
This provided a starting point for planning the integration of the companies and developing common values. A start has been made but full implementation will require longterm work. Success will be measured by the annual climate survey. In the first common survey, 57 per cent of the respondents said that the Sampo-Leonia merger had started well and 78 per cent believed in a smooth future co-operation.
Despite the pace of change following the agreement to merge Sampo and Leonia, the staff’s work ability has continued at a good level. However, the changes have put some pressure on the overall level of staff satisfaction.
Sampo-Leonia 31.12.2000 1 Comprehensive school 2 Secondary school 3 Vocational school 4 College 5 University 1 Level of satisfaction 2 Experienced stress 3 Experienced work ability 4 Information flow 1996-1999 Sampo Group, 2000 Sampo-Leonia
The Green Office Environmental System aimed at reduced consumption and more efficient recycling of waste was updated and audited in the Lauttasaari offices in Helsinki.
120,422,555.30 as in accordance with the Articles of Association. The company’s share capital was FIM 520 million or EUR 87,457,721.76 on 31 December 2000. Sampo’s
General Meeting decided in its meeting on 12 April 2000 to cancel these shares and to lower the share capital by FIM
7,600,000, or EUR 1,278,228, which was the total nominal value of the bought shares. The Annual General Meeting also authorised the company’s Board of Directors to decide on the buy-back and conveyance of own A shares. The authorisation applies to a maximum of 5 per cent of the company’s share capital and of all votes. The authorisation is valid until 11 April 2001.
Decrease in 4 May 2000 Cancellation of shares bought –1,520,000 302.4 50.86 share capital back (1,520,000 A shares)
At the end of the financial year the Board of Directors was not authorised to issue shares, convertible bonds or bonds with warrants.
84.09) will be attached 250 warrant certificates, of which 75 will be marked with the letter A, 75 with the letter B and 100 with the letter C. With each warrant certificate one