• 2005 The Norwegian parliament, rules that all companies must have an occupational pension scheme in place by 2007. Storebrand responds to the challenge with its new product, Storebrand Folkepensjon.
These microfinance banks offer their services to people who want to start up their own businesses, e.g. by lending them money to buy farm animals, a sewing machine or tools.
1 High-risk industries are defined as industries exposed to substantial environmental or social risks 2 In 2006, Storebrand became one of the first Nordic actors to sign the UN Principles for Responsible Investments, www.unpri.org 3 A number of external asset managers invest in companies that are outside the universe Storebrand monitors in relation to corporate responsibility. However, we are working to find a solution with respect to monitoring these companies 4 www.baerekraftigverdiskaping.no
The SPP group attained profits of NOK 831 million prior to amortisation of intangible assets compared with NOK 194 million in 2007. The risk result of NOK 287 million and the administration result of minus NOK 103 million accrue to the owners in their entirety.
Skadeforsikring was re-established in the autumn of 2006. The new business area provides standard P&C insurance products in the retail market in Norway, as well as some individual business insurance for the SMB market. Apart from the new business, Storebrand Skadeforsikring bears fronting responsibility for the risk associated with policies taken out before the take-over of the P&C insurance business of If in 1999 as well as the run-off of its own reinsurance business and managing other companies ’ run-off business through a subsidiary,
CAMILLA M. GRIEG (45), CEO, Grieg Shipping Group AS. Board Member for Storebrand ASA since 2007.
Previous positions: 1998–2006: CEO, Grieg Shipping AS • 1995–1998: Director, Grieg Shipping AS • 1993–1995: Corporate Market Analyst, Star Shipping • 1990–1993: Financial Analyst, Bergen Fonds AS. Positions of trust: 2009- : Board Member for Grieg Star Shipping AS • 2007–: Chairman of the Board for Bergen Rederiforening. Board Member for GCRieber AS • 2005–2006: Board Member for Rieber Shipping AS • 1995- : Board Member for Grieg Shipping Group A, Grieg Maturitas AS • 1995-2008: Board Member for Star Shipping AS.
In order to render visible how corporate responsibility has been integrated into the core enterprise, the group is for the first time reporting both financial and non-financial goals and results in its annual report. The targetss for the group’s work with corporate responsibility are described in the goal matrix on p. 142. The results have been reviewed for the first time by an external auditor. Highlligts in 2008 includes i launching of a separate climate criteria for investments, increased efforts in active ownership and microfinancing, developing procurement guidelines with clear environmental and social responsibility requirements. In addition the group launched its code of conduct that is tied to performance evaluations, the average lllness absence was reduced and we launched an ecological driving course on the Internet. For
In Norway there were 35 new employees over the age of 45, compared with 30 in 2007. Internal studies show that there are an increasing number (more than 50 percent)
Storebrand has its own corporate priest who can be used by employees as a conversation partner. Individual employees may also contact the priest directly. The priest is also available for special events, for example deaths, serious illnesses, lay-offs, firings and the like. In addition, the priest contributes to ethics discussions at internal development programmes.
Future prospects In recent years, Storebrand has achieved solid profitability and strong competitiveness in the market for long-term savings and insurance in Norway. The acquisition of SPP in
Good sales figures and the strong net influx of accounts in 2008 confirmed Storebrand’s strong competitive position in Norway. In
Application of the year’s result: Amounts in NOK million: From other equity: -13.6
The group’s vision is to be the leading and most respected institution within savings and insurance. In other words, customers should regard Storebrand as a highly credible and competent partner. Ambitious customer goals have therefore been set in various areas.
In 2008, the Ministry of Finance asked for comments on a proposal to cancel occupational pensions providers’ sole right to issue paid-up policies. Were this adopted, it would mean that companies could choose to sign a contract to issue paid-up policies with a company other than the one administering the occupational pension scheme for its active members. The consultation process has concluded and the proposal is awaiting consideration by the Ministry
December 2008, together with the return in the customer portfolios, helped to reduce the fall in conditional bonuses in a market with falling interest rates.
NOK 750 million, which largely explains the difference. The premium income in mutual fund insurance/unit-linked amounted to NOK
The bank aims to be seen as a bank that is easy to relate to, with popular products at competitive prices. The banking group has total assets of NOK 45.6 billion and 374 employees.
58 million in 2007. Other income amounted to NOK 89 million compared to NOK 46 million in 2007. Income was affected by developments in the financial markets. The acquisitions of the real estate companies
operating expenses amounted to NOK 382 million in 2008 compared with NOK 345 million in 2007, equivalent to a cost ratio of 63.1 percent compared to 69.0 percent in 2007.
P&C insurance in the Norwegian retail market and some corporate insurance policies in the
SMB market. Incoming telephone and online sales account for more than 90 percent of total sales, of which online sales account for 53 percent. Low distribution costs and correct risk prices allow the company to offer quality products at competitive prices.
Straight-line depreciation is applied over the following periods: Contractual customer relationships 5–7 years
Goodwill Excess value arising from the acquisition of business activities that cannot be allocated to specific asset or liability items at the date of acquisition is classified as goodwill in the balance sheet. Goodwill is valued at its acquisition cost at the time of acquisition. Goodwill acquired by acquiring subsidiaries is classified as intangible assets. Goodwill acquired through interests in associated companies is included in the investment in the associated company and is tested for impairment as part of the value of the write-down recognised in the investment.
Tax The tax charge in the profit and loss account consists of tax payable for the accounting year and changes in deferred tax. Tax is recognised in the profit and loss account, except when it relates to items that are recognised directly against equity. If this is the case, the tax is also recognised directly against equity. Deferred tax and deferred tax assets are calculated on the basis of differences between accounting and tax values of assets and liabilities. Deferred tax assets are recorded in the balance sheet to the extent it is considered likely that the companies in the group will have sufficient taxable profit in the future to make use of the tax asset.
If a return guarantee is linked to a special investments portfolio, a supplementary provision is made to cover the guarantee obligation. The supplementary provision to cover the company’s obligation pursuant to section 11-1, fourth paragraph, of the Companies Pension Act shall equal the difference between the capitalised value of the company’s obligations vis-à-vis the insured, calculated pursuant to section 9-16 of the Insurance Act and the value of the investments portfolio.
Extra values associated with the brand name and customer relationships (that are not included in VIF) have been identified. These are valued at around NOK 657 million, which is amortised over 7-13 years.
On the fixing of the salary and other remuneration for senior employees
Storebrand ASA has issued guarantees to the Institute of London Underwriters (ILU) for Oslo Reinsurance Company ASA’s obligations to properly fulfil insurance agreements that the company has subscribed to through the ILU. Storebrand ASA has the right of recourse against Oslo Reinsurance Company ASA for any possible disbursements. The underlying liability the guarantees concern have in all essence been settled.
For interest rate derivatives, a long position produces a gain if interest rates fall, as is the case for bonds. A long position in a currency derivative produces a gain if the currency strengthens against the NOK.
Commitments overdue by more than 90 days are defined as being in default. Only defaulted commitments are distributed by geographical area in this overview. Commitments are deemed to be in default when a credit has been overdrawn for more than 90 days and when a repayment loan has a remaining balance for more than 90 days and the amount is at least NOK 500.
Storebrand is a financial group and has legally mandated requirements for primary capital under both the capital adequacy regulations and the solvency margin regulations. Primary capital encompasses both equity capital and subordinated loans. For Storebrand, these legal requirements carry the greatest significance in its capital management.
Encompasses security reserves, subordinated loan capital, booked equity and liability items.1
Profit sharing for Storebrand Livsforsikring With the introduction of the new Insurance Act on 1 January 2008, the profit sharing at Storebrand has been changed. As previously, products both with and without profit sharing are being operated with, however for the products under the category with profit sharing three new profit sharing models have been introduced.
Men Women 30 yr 45 yr 60 yr 30 yr 45 yr 60 yr
The following table shows the proportions of insurance fund reserves at 31 December 2007 relating to policies with various basic annual interest rates: Interest rate guarantee 2008 2007
A 20 percent fall in mortality would entail an annual risk result that was approx. SEK 130 million lower for SPP. If the probability of reactivation in the event of disability sinks by 20 percent, this would entail an annual risk result that was approx. SEK 50 million lower. SPP’s cancellation risk is very small since the majority of the policy portfolio cannot be repurchased.
Insurance-related gross operating costs -22.6 -57.2 -117.1 -196.9 -27.3 -2.3 -30.5 -257.1 -251.4
Reconciliation to show the change in defined benefit pension liability in the period
Percentage of post-tax group profit distributed as dividend 27% > 30% 0% > 35%
emissions (tonnes) 8 3,235 tonnes Analyse 2,709 tonnes Reduce by 20%
We have based our work on the international standard ISAE 3000 “Assurance Engagements other than Audits and Reviews of Historical