Financial Stability Board encourages the �nancial sector to integrate systematic risk analyses based on the climate changes we are facing. In the future, the �nancial sector will have to manage several types of climate-related risks, however these changes also mean there will be many new opportunities.
When climate risks and opportunities are included in investment decisions, this will result in increased investment in climate-friendly companies and less investment in the worst polluters. To �nd the “climate smart” companies, we have adapted analyses and indicators that have di�erent ways of measuring the impact on the climate. The expectation of better �nancial results for the sustainable companies is based on indicators identi�ed in areas that are both important from a climate perspective and �nancially relevant for the company. For example, the analyses can identify investments that have energy e�cient production or that o�er climate-friendly products.
Storebrand is recognised nationally and internationally for its sustainable asset management. We have been designated as the world’s second most sustainable company by The Corporate Knights. The results from this study were presented at the World Economic Forum in Davos.
Environmental value creation: Climate adjustment – Storebrand and Storebrand’s stakeholders consider sustainability issues and adjustment with the goal of creating a world with lower CO2 emissions to be among the most important strategic and �nancial areas for most industries in all parts of the world.
Historical share prices have been adjusted to take account of the split between shares and subscription rights carried out in 2007.
will be covered by the surplus return, risk surplus and the elimination of pro�t sharing. For more information on strengthening of reserves for increased longevity, see Note 47.
The result for Savings was NOK 1,063m for 2016. Adjusted for special items in 2015 and 2016, there was earnings growth of 1% for the year. [7]
Insurance is responsible for the Group's risk products in Norway and Sweden. [8]
Guaranteed reserves in % of total reserves 64.9 % 67.6 %
The Solvency II regulations were introduced on 1 January 2016. The Group’s target solvency margin in accordance with the new regulations is a minimum of 150%, including use of the transitional rules. The solvency margin for the Storebrand Group was calculated at 160% at the end of 2016, including the transitional rule and before proposed dividends. After the proposed dividend is taken into the consideration, the solvency margin is 157%. The Group’s target solvency margin in accordance with the new regulations is 150%, including use of the transitional rules.
In addition, this segment comprises lending to commercial enterprises by Storebrand Bank and the activities of BenCo.
Leadership for Sustainable Development (SLSD) together with over 20 of Sweden’s largest listed companies. The network is coordinated by the
As part of this and as a consequence of the digitalisation of society and working life, the Group has established a powerful unit for digital business development. This unit will not only drive innovation in a customer and service dimension, but also in the form of organisation, management and work processes.
In 2016, the following changes to the membership of Storebrand’s corporate bodies took place: Board of Directors of Storebrand ASA
Storebrand’s risk appetite and risk strategy, including investment strategy. The Committee should contribute forward-looking decision-making support related to the Board’s discussion of risk taking, �nancial forecasts and the treatment of risk reporting. The Risk Committee has held eight meetings in 2016, including a joint meeting with the Audit Committee.
Board of Directors has drawn up instructions for Storebrand’s subsidiaries that are to ensure that they implement and comply with the Group’s management and control policies and guidelines.
�nancial performance and solvency. This provides important premises for the Board’s general discussion of risk appetite, risk allocation and capital adequacy.
The Group’s executive personnel, as de�ned in detail in the regulatory framework, receive only a �xed salary. The Group’s executive management team use a percentage of their �xed salaries to purchase shares in Storebrand with a lock-in period of three years. This is to clarify that Storebrand’s top management act in accordance with the long-term interests of the owners.
8. Provisions in the Articles of Association and authorisations granting the board the authority to buy back or issue the Group’s own shares are discussed in section 3 above.
Authorized Finance Analyst (AFA) — (Norwegian School of Economics and Business Administration)
Career 2011–2012: Managing Director, Storbrand Life Insurance 2002–2011: Executive Vice President, CFO and Group Legal 1998–2002: Head of Business Control, Storebrand ASA
Career 2010–2012: Chief Commercial O�cer, SAS Group 2010–2012: Senior Vice President, Global Head of Sales & Marketing, SAS Group 2005–2008: Senior Vice President, SAS Group 2003–2005: Vice President, Sales & Marketing, SAS Norway 2001–2003: General Manager, Scandinavian Airlines, UK & Ireland 1997–2001: Director Marketing & Sales, Scandinavian Airlines, UK & Ireland 1995–1997: Manager Business Controll, SAS International
Tax on other result elements not to be classified to profit/loss 37 49
Cash and cash equivalents at start of the period 3,132 5,473
Cash and cash equivalents at the end of the period 3,966 3,132 * Consist of: Lending to �nancial institutions 272 123
An important standard for Storebrand’s consolidated financial statements will be IFRS9 Financial Instruments, that will replace IAS39 with effect from 1 January 2018. Among other things, IFRS9 deals with classification and measurement of financial instruments (use of fair value and amortised cost), and rules for writing down financial instruments. For insurance-dominated groups and companies, IFRS4 allows for either the implementation of IFRS9 to be deferred (deferral approach) or to enter the differences between IAS39 and IFRS9 through Other Comprehensive
Intangible assets with limited useful economic lives are measured at acquisition cost less accumulated amortisation and any write downs. The useful life and amortisation method are measured each year. With initial recognition of intangible assets in the statement of financial position, it must be demonstrated that probable future economic benefits attributable to the asset will flow to the Group. The cost of the asset must also be measured reliably. The value of an intangible asset is tested for impairment when there are indications that its value has been impaired. In other respects intangible assets are subject to write-downs and reversals of write-downs in the same manner as described for tangible fixed assets.
If a market for a financial instrument is not active, fair value is determined by using valuation techniques. Such valuation techniques make use of recent arm’s length market transactions between independent, unrelated, and well informed parties where available, reference to the current fair value of another instrument that is substantially the same, discounted cash flow analysis, and options pricing models. If a valuation technique is in common use by participants in the market and this method has proved to provide reliable estimates of prices actually achieved in market transactions, this method is used.
(undistributable equity). See Note 3, for further information on the use of the risk equalisation reserve to strengthen the longevity reserves.
Solvency II: For terms to maturity up to 10 years, the discount rate is determined based on the quoted swap interest rates, adjusted for both credit risk
The modified profit-sharing model means that any negative risk result can be deducted from the customers’ interest profit before sharing, if it is not covered by the risk equalisation fund.
In the new income statement, “�nancial items and risk result life and pensions” includes the following lines from the statement that was used in 2015: risk result life and pensions
Storebrand Bank and the activities at BenCo, as well as minority interests in securities funds and property funds. The elimination of intra-group transactions that have been included in the other segments has also been included.
Amortisation and write-downs of IT-systems are included in operational cost from 2016. Comparative �gures for 2015 are changed, see also note 23 and 29[2]
For P&C insurance (occupational injury, property and motor vehicle) the tariffs are based on the company’s own experiences.
The company also manages its insurance risk through international pooling. This implies that multinational corporate customers can equalise the results between the various units internationally. Pooling is offered for group life and risk cover within group defined-benefit and definedcontribution pensions.
For company portfolios and guaranteed customer portfolios, most of the assets that are in currencies other than the domestic currency are hedged. This limits the currency risk from the investment portfolio. Foreign exchange risk primarily arises as a result of investments in international securities, as well as subordinated loans in a foreign currency to a certain extent. Hedging is performed by means of forward foreign exchange contracts at the portfolio level, and the currency positions are monitored continuously against a total limit. Negative currency positions are closed out no later than the day after they arose. In addition, separate limits have been defined so that active currency positions can be taken. Storebrand employs a currency hedging principle called block hedging, which makes the execution of currency hedging more efficient.
Storebrand Bank ASA hedges net balance sheet items by means of forward contracts.
The bank has two credit facilities with Storebrand Boligkreditt AS. One of these is an ordinary overdraft facility of up to NOK 6 billion. This has fi interest and principal on covered bonds and related derivatives for the next 31 days. The credit facility is not revocable by the bank until three months after the maturity of the longest covered bonds and related derivatives.
These regulate how collateral is to be pledged against changes in market values that are calculated on a daily basis, among other things.
Level 1: Financial instruments valued on the basis of quoted prices for identical assets in active markets
An individual required rate of return is determined for each property. The required rate of return is viewed in connection with the related cash ow for the property. The knowledge available about the market’s required rate of return, including transactions and appraisals, is used when determining the cash ow.
The investment is classi�ed as “Investment in Associated Companies” in the Consolidated Financial Statements.
They are not priced by a discount rate as bonds normally are, and therefore these investments are included in the same sensitivity test as private equity.
Includes lending to customers/liabilities to �nancial institutions classi�ed at fair value through pro�t and loss[3]
Employees who were on sick leave and partiality disabled during the transition to the defined-contribution pension, remain in the definedbenefit pension scheme. There are also pension liabilities for the defined-benefit scheme related to direct pensions for certain former employees and former board members.
ambitious model of cooperation, as well as transparency that enhances the Group’s reputation. Therefore the company will primarily stress a fi fi
2. BINDING GUIDELINES FOR SHARES, SUBSCRIPTION RIGHTS, OPTIONS, ETC. FOR THE COMING 2017 FINANCIAL YEAR
Of the total vacancy, 9.2 per cent (6,8 per cant) is related to to space that is unavaiilable for leasing due to ongoing development procjects.
Allocation by company and customers: Properties for own use – customers 2,863 2,887
Storebrand Life Insurance SPP Pension & Insurance Euroben Storebrand Bank Storebrand Insurance
750 million was taken up. The loan was used as a hedging instrument relating to the hedging of the net investment in SPP. The effective share of hedging instruments is recognised in total profit. The net investment in SPP is partly hedged and therefore the expectation is that future hedge effectiveness will be around 100 per cent.
The solvency capital is divided into three capital groups in accordance with Section 6 of the Solvency II Regulations. Tier 1 capital consists of paid-in capital and It also includes perpetual subordinated loans (perpetual hybrid Tier 1 capital) with up to 20 per cent of Tier 1 capital.
Proposed and approved dividends and group contributions from subsidiaries at the end of the year are recognised in the financial statements of Storebrand ASA as income in that financial year.
For further information on senior employees, the Board of Directors, the Control Committee and the Board’s statement on �xing the salary and other remuneration of senior employees, see note 25 in the Storebrand Group.
Loans with fixed rates are hedged by interest swaps, which are booked at fair value through profit and loss. Changes in values of loans that can be related to the hedged risk are included in the carrying amount and included in the result.
Norwegian Accounting Act, Norwegian Regulations relating to annual accounts, etc. for insurance companies and the additional requirements in the Norwegian Securities Trading Act. The annual report for the Group and parent company complies with the requirements of the Norwegian
Average remaining term to maturity of the cash ow from interest-bearing securities. The modi�ed duration is calculated based on the duration and expresses the sensitivity to the underlying interest rate changes.
Tier 2 capital is part of the primary capital and consists of subordinated loan capital and the portion of the hybrid tier 1 capital that is not counted as core (tier 1) capital. There is a 50 per cent deduction for any capital adequacy reserve and deduction for cross-ownership in other
These are contracts with earned rights that are issued upon withdrawal from or the termination of pension contracts.