The Major Risks and Uncertainties to the Group in the Near-Term . . . . . . . . . . . . . . . . . . . . . . .31
BA Private the premium growth amounted to 2.4 per cent and in BA Commercial 2.6 per cent.
Nordea continues to deliver on its cost efficiency plans with costs below EUR 4.8 billion for 2018, excluding the goodwill write-down in Russia of EUR 141 million. Nordea is well on track to reach our 2021 target to reduce costs by 3 per cent compared to 2018 and in 2019 the target is to have lower costs than in 2018, adjusted for non-recurring costs in 2018 and 2019. Common Equity Tier 1 capital ratio was 15.5 per cent, in line with Nordea’s expectations and well above the required level of 13.9 per cent.
During 2018 fair value reserve decreased to EUR 352 million (599).
With profit reserves continued to decrease as planned during 2018 and amounted to EUR 4.2 billion (4.6) on 31
Following the completion of the offer, Nordic Capital held 63,75 and Sampo 36,25 per cent of the shares and votes in NDX Intressenter. NDX Intressenter became Sampo’s associated company in March 2018.
as of 1 of January 2019. He was earlier CFO of If Group and a member of the Sampo Group Executive Committee.
The Corporate Responsibility function operates under the Group Chief Financial Officer (CFO) as of 1 January 2019. In addition, Sampo appointed a Head of Corporate
The relative proportions of fixed and variable compensation reflect the responsibilities of individual executives and employees. Fixed salaries shall represent a sufficiently high share of the total remuneration. Variable compensation may be based on the contribution to the company’s profitability and on individual performance or linked to committing employees to Sampo Group.
The value of one incentive unit is calculated as the difference between the trade-weighted average price of the Sampo A share at the time of payment and the dividend-adjusted starting price. In addition to the share price development, the calculation of the value of one incentive unit takes into account the performance of the insurance margin of If and the return on capital at risk as further specified in the terms of the respective incentive scheme. Both schemes contain a cap for maximum payout. The terms of the incentive schemes are available at www.sampo.com/incentiveterms.
A deferral rule applies to incentive rewards paid to key employees who are considered as identified staff and are subject to the deferral rule in accordance with the remuneration policies of the relevant Sampo Group companies in force at the launch of the incentive schemes. At payout from the schemes, the identified staff shall acquire Sampo A shares with a certain part of the installment after deducting income tax and other comparable charges. The shares are subject to disposal restrictions for three years, after which the Board of
The authorization will be valid until the close of the next
tions of change in holding pursuant to Chapter 9, Section 5 of the Securities Markets Act, of which 26 related to the total number of Sampo A shares or related voting rights owned by BlackRock, Inc. (tax ID 32-0174421) and its funds directly or through financial instruments, four to
AGM. The dividend is proposed to be paid on 8 April 2019.
(PIM) Solvency Capital Requirements (SCR) for most of non-life insurance business of If and Topdanmark in FICO
Top dan mark are approved by their respective local regulators, and therefore the Standard Formula SCRs are applied in Solvency II on a group-level. The treatment of
Topdanmark calculates most of its non-life and health risks and their respective solvency capital requirement by a partial internal model approved by the DFSA. Other risks are calculated by Solvency II SCR standard formula.
Programme senior unsecured fixed rate notes of EUR 500 million maturing on 21 February 2028.
In its current day-to-day business activities Sampo Group is exposed to various risks and uncertainties mainly through its separately managed business areas including the parent company Sampo plc.
According to Sampo plc’s dividend policy, total annual dividends paid shall be at least 50 per cent of the Group’s net profit for the year (excluding extraordinary items). In addition, share buy-backs can be used to complement the cash dividend.
Premiums written before reinsurers' share, P&C insurance EURm 1,235 210 - - -
Average adjusted number of shares 1,000 1,200 1,200 1,200 1,200 1,200 *) In the comparison year 2017 Topdanmark was consolidated as an associate between January - September 2017. The key figures are from October - December 2017 when the company was first consolidated as a subsidiary. 1) On 31 Dec. 2009 Nordea was consolidated as an associate to Sampo and Sampo became a financial and insurance conglomerate, in accordance with the Act on Supervision on Financial and Insurance
Other comprehensive income for the period -15 -138 60 -93 -93
The items of the statement of cash flows cannot be directly concluded from the balance sheets due to e.g. exchange rate differences, and acquisitions and disposals of subsidiaries during the period.
or loss are assets which, at inception, are irrevocably designated as such. They are initially recognised at their fair value. They are recognised in the income statement and balance sheet accordingly with above-explained assets held for trading.
Reinsurance contracts A reinsurance contract is a contract which meets the
The preliminary purchase price allocation on the acquisition is presented below: EURm Cost of the business acquisition 241
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 66FINANCIAL STATEMENTS 2018
loss and the above-mentioned gain from fair valuation of former associated company is recognised as a separate line item. Topdanmark is reported as a separate segment in all segment reporting. As of 1 October 2017,
Topdanmark's p/l items have been recognized line-byline in the Group's consolidated financial statements.
Fair values for the Group's investment property are entirely determined by the Group based on the market evidence. The determination and hierarchy of financial assets and liabilities at fair value is disclosed in note 17. Based on the principles of this determination, the investment property falls under levels 2 and 3.
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 76FINANCIAL STATEMENTS 2018
The carrying amount of investments in associates included goodwill EURm 986 (990), including goodwill from the Nordea acquisition EURm 978 (978).
14 Financial assets Group's financial assets comprise investments in derivatives, financial assets designated as at fair value through p/l, loans and receivables, available-for-sale financial assets and investments in subsidiaries. The Holding segment includes also investments in subsidiaries.
The value of financial assets regarding the debt security instruments has been tested by assuming a rise of 1 per cent unit in interest rate level in all maturities. For other financial assets, the prices were assumed to go down by 20 per cent. Sampo Group bears no investment risks related to unit-linked insurance, so a change in assumptions regarding these assets does not affect profit or loss. On the basis of the these alternative assumptions, a possible change in interest levels at 31 December 2018 would cause a descend of EURm -1 (-1) for the debt instruments, and EURm -246 (-143) valuation loss for other instruments in the Group's other comprehensive income. The reasonably possible effect, proportionate to the Group's equity, would thus be 2.0 per cent (1.1).
Current estimate of total claims costs 18,208 2,352 2,599 2,767 2,697 2,716 2,687 2,677 2,770 2,814 2,921 45,207
The loan issued in 2018 is issued with variable interest rate terms. The loan includes terms stating the right of redemption after five years and at any interest payment date thereafter.
Total in comprehensive income statement 14 0 14 -3 8 5
Net liability recognised in balance sheet 24 28 51 22 35 57
Net pension liability recognised in the balance sheet 23 28 51 28 29 57
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 110FINANCIAL STATEMENTS 2018
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 113FINANCIAL STATEMENTS 2018
The classification of the insurance portfolio as assets held for sale and liabilities related to assets held for sale has ended as a result of the agreement.
In the table Technical Provisions by Line of Business and Major Geographical Area, If, 31 December 2018, the technical provisions and durations of If are presented by
The actuaries continuously monitor the level of provisions to ensure that they comply with the established guidelines. The actuaries also develop methods and systems to support these processes.
In general, If is negatively affected when interest rates are decreasing or staying at low levels, because the duration of liabilities in If is longer than the duration of assets.
Most of the fixed income exposures are in investment grade issues and currently the role of Nordic covered bonds and Nordic banks as issuers is central. Within fixed income investments part of the money market securities, cash and investment grade government bonds form a liquidity buffer.
and the maximum exposure to individual reinsurers. Also, the own credit-analysis plays a central role when counterparties are selected.
51.9 million. Of this amount, 100 per cent was related to reinsurance counterparties with a credit rating of A- or higher.
Non-Life Underwriting Risks As shown in the figure Breakdown of Gross Written
When market risks are measured and managed, all exposures are included, regardless of whether they arise from active portfolio management on the investment side or from annuities, which are considered as market risk.
Credit bonds are composed of a well-diversified portfolio, primarily exposed to businesses in Europe and in the
The maturity structure of technical provisions is presented in the adjacent table.
Currency Annual loss with up to a 2.5% probability -0.1 -0.8
Committee also reports all deviations from the Underwriting Policy to the RMC. The Insurance Risk Committee is chaired by the Chief Actuary who is responsible for ensuring that the principles for pricing policies and for the calculation of technical provisions are adequate and in line with the underwriting and claims management processes.
Dec 2017 risk exposures relating to reinsurance and derivative transactions. Counterparty default risks are described in more detail in section Counterparty Default Risks. Due to differences in the reporting treatment of derivatives, the figures in the table may not be fully comparable with other tables in the Financial Statements.
Risk Considerations at Sampo Group Level and Sampo plc Sampo Group is first and foremost exposed to general performance of the Nordic economies. However, the Nordic economies typically are at any given time in somewhat different stages of their economic cycles, because of reasons such as different economic structures and separate currencies. Also, geographically the Nordics as a large area is more a source of underwriting diversification than a concentration. Hence, inherently the Nordic area is a good basis for diversified business.
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 153FINANCIAL STATEMENTS 2018
Fixed Income Investments in the Financial Sector Sampo Group Excluding Topdanmark, 31 December 2018
Notes on Shares Held 20 Shares held as of 31 dec, 2018 ......................................... 175
Notes on the Income Taxes 14 14 Deferred tax assets and liabilities