INTERIM REPORT 1 JANUARY TO 31 MARCH 2018: THE MERGED ILMARINEN TAKES CARE OF THE PENSION COVER OF MORE THAN 1.1 MILLION FINNS
In January–March, the return on Ilmarinen’s investment portfolio was -0.1 per cent (1 Jan–31 March 2017: 2.2 per cent). At the end of March, the market value of investments stood at EUR 46.1 billion (31 March 2017: EUR 38.3 billion). The long-term average real return is 4.2 per cent per annum.
Ilmarinen’s solvency ratio remained at a good level, at 127.8 (129.7) per cent. Measured in premiums written, the customer base grew by approximately EUR 20 million during the first quarter. The merger of Ilmarinen and Etera was completed on 1 January 2018 as planned and the first phase of the integration process was a success. The new organisation started operations on 1 March 2018. The merged Ilmarinen takes care of the pension cover of more than 1.1 million Finns.
Ilmarinen’s acting President and CEO Stefan Björkman:
“The negative return on key equity markets depressed the Q1 investment result, which failed to rise above -0.1 per cent. The return on fixed income investments and real estate investments was positive, whereas equity investments and other investments remained in negative territory. In the past 12-month period, Ilmarinen’s investments have yielded 4.8 per cent, with the long-term average real annual return at 4.2 per cent, which clearly exceeds the 3.0 per cent return assumption used by the Finnish Centre for Pensions in its calculations. Following the merger, solvency declined somewhat, but was still at a strong level, at 127.8 per cent.
Since the beginning of the year, Ilmarinen has been managing the pension cover of more than 1.1 million Finns and we are the largest earnings-related pension insurer in Finland’s private sector. At the end of March, the number of pensioners was 468,000. During the early part of the year, we made more than 14,000 pension decisions, of which close to 8,000 were new pension decisions. In February, we garnered interest by publishing a survey at the iAreena event. According to the survey, people currently retire on old-age pension in good health and up to four out of five would have had the physical and mental resources to continue in gainful employment. In March, we awarded, from among 100 nominees, Finland’s Best Boss in a national competition where anyone could nominate an excellent manager that they knew.
Measured in premiums written, the customer base grew by approximately EUR 20 million during the first quarter.
Etera’s merger into Ilmarinen was completed at the turn of the year. The first phase of the integration process was a success: the investment portfolios, HR and financial administration were merged as planned and the employees moved to shared premises in Ruoholahti. However, the integration process still continues by, for example, gradually merging the IT systems related to insurance and pensions over the next two years. Our objective is to fully achieve the integration benefits by 2020.
Ilmarinen’s organisation was restructured during the early part of the year. In January, we completed the co-operation negotiations concerning the entire personnel. Combining the strengths of both companies, the new organisation is better suited to meet the changes in the operating environment. We strengthened our expertise for instance in work capacity management, robotics and real estate investment. At the same time, we eliminated overlaps resulting from the merger.
Changes have also taken place in Ilmarinen’s senior management. Our previous President and CEO Timo Ritakallio took on the position of OP Financial Group’s President on 1 March 2018, and I, the undersigned, am temporarily in charge of the tasks of Ilmarinen’s President and CEO. Ilmarinen’s Board of Directors has elected Jouko Pölönen as the company’s new President and CEO. He will join Ilmarinen in the beginning of May and take on the position of President and CEO as of 1 August.”
Stefan Björkman, acting President and CEO, tel. +358 50 632 19
Mikko Mursula, CIO, tel. +358 50 380 3016
Jaakko Kiander, Chief Communications Officer, +358 050 583 8599