BÂLOISE HOLDING AG Media information
2019 annual financial results for Basler Versicherungen Switzerland and Baloise Bank SoBa
A good year for Basler Switzerland in 2019
Basel, 26 March 2020
Basler Insurance's business in Switzerland was robust last year, as could be seen from its excellent results for 2019. The volume of business increased sharply, while profitability and earnings before interest and tax remained at a high level. In collaboration with Baloise Bank SoBa, the comprehensive range of financial services was further expanded. Moreover, the innovation pipeline is full of projects in the 'Home' and 'Mobility' ecosystems. In the current crisis situation, Basler Insurance and Baloise Bank SoBa particularly want to be a strong and dependable partner and, over the past few weeks, have been working hard to maintain services for their customers while ensuring maximum protection for their employees.
Highlights of the 2019 annual financial results for Basler Insurance and Baloise Bank SoBa
Insurance*
- Strong core business with good results despite persistently challenging conditions
Good technical result, with a net combined ratio of 87.9 per cent in the non-life business despite higher claims incurred and a smaller profit on claims reserves. - Market opportunities in group life business lead to a much higher volume of premiums
The withdrawal of a competitor from business involving comprehensive insurance solutions for occupational pensions resulted in additional premiums of around CHF 560 million. The partially autonomous collective foundation Perspectiva also continued to generate strong growth. - Expansion of the 'Home' and 'Mobility' ecosystems; increase in the number of new customers
Besides the very good results in the core business, 2019 was also characterised by capital expenditure on the 'Home' and 'Mobility' ecosystems. In collaboration with Movu, laundry services provider Bubble Box and Devis.ch, a platform for the services of tradespeople, were integrated into the business model.
Banking**
- Combination of banking and insurance meets customers' needs: Another double-digit increase in the number of asset management mandates (23 per cent) and an excellent return on investment (over 26 per cent in portfolios with high equity exposures)
- Rise in profit to CHF 24.5 million thanks to significant expansion of brokerage business
- Encouraging growth in lending business, with credit risk costs remaining low
Summary of business performance for the Swiss market
Business performance of Basler Insurance and Baloise Bank SoBa
Key figures (CHF million) | |||
2018 | 2019 | +/- (%) | |
Business volume of Baloise Switzerland* | 4,190 | 4,921 | 17.4 |
Of which: life | 2,728 | 3,423 | 25.5 |
Of which: non-life | 1,349 | 1,344 | -0.4 |
Profit before borrowing costs and taxes of Baloise Switzerland* | 554 | 500 | -9.7 |
Total assets of Baloise Bank SoBa** | 7,708 | 7,996 | 3.7 |
Net profit of Baloise Bank SoBa** | 23.7 | 24.5 | 3.3 |
Review of operating performance
Basler Versicherungen Switzerland remains the Group's strongest source of earnings and generates the greatest volume of premiums, as could be seen from its excellent results for 2019. Earnings before interest and tax, profitability and premium income remained at a high level, collaboration with Baloise Bank SoBa was further intensified across Switzerland and the innovation pipeline is full of projects in the 'Home' and 'Mobility' ecosystems. The volume of business rose by 17.4 per cent to CHF 4,920.5 million (2018: CHF 4,189.5 million), with the bulk of this increase attributable to the growth of the volume of premiums in the group life business. EBIT was down by 9.7 per cent year on year to CHF 500.2 million (2018: CHF 554.2 million), mainly due to the reduction in realised gains on investments and due to a slightly higher combined ratio. The volume of premiums in the non-life division remained on a par with the strong prior-year figure at CHF 1,344.2 million (2018: CHF 1,349.2 million). Basler Switzerland signed up numerous new customers for its services once again thanks to the alliance with KASKO, a strong year for Movu and the success of the YounGo insurance line, which is aimed at customers up to the age of 30.
The EBIT attributable to the Swiss non-life business fell to CHF 230.7 million (2018: CHF 317.5 million) owing to the aforementioned effects. Having been at an excellent 84.5 per cent in 2018, the net combined ratio returned to a normal level but was still very good at 87.9 per cent.
In the life division, a competitor in the group life business withdrew its comprehensive insurance products from the market, resulting in a sharp rise in the volume of premiums. In 2019, gross premiums written in the life business rose by 25.5 per cent overall to reach CHF 3,422.9 million (2018: CHF 2,728.0 million). Of this total, CHF 3,019.8 million was attributable to group life business (2018: CHF 2,331.7 million).
In individual life insurance, premium income advanced by 1.7 per cent to CHF 403.1 million (2018: CHF 396.3 million).
The partially autonomous collective foundation Perspectiva continued to generate strong growth, and the total number of companies signed up rose to 2,133 in 2019 (2018: 1,345), including around 9,800 policyholders and foundation assets of more than CHF 700 million.
EBIT in the life business came to CHF 208.4 million and was thus much higher than the prior-year figure (2018: CHF 176.9 million). This was primarily the result of higher gains realised on investments and higher gains on investment property.
The banking business continues to perform well, which is testament to the success of the unique business model of banking and insurance in Switzerland. The number of asset management and investment advice mandates increased by 23.4 per cent to 2,646. EBIT was on a par with the prior year at CHF 28.5 million (2018: CHF 29.1 million).
Baloise Bank SoBa increased its profit by 3.3 per cent to CHF 24.5 million last year. Registering net growth of CHF 244 million (3.9 per cent), the mortgage business is helping to offset the declining margins in interest-rate business while more favourable funding opportunities helped to reduce expenses. The risk costs for the credit portfolio remain low. The strategy of a business model combined with insurance resulted in a 23 per cent rise in the number of asset management mandates in 2019. Net commission income jumped by 41 per cent thanks to further strong growth in business and the excellent performance of customer assets. This result reflects the successful expansion of the asset business in recent years. Even including the extraordinary market-related effects, the recurring income from securities and investment business was higher than in previous years at around CHF 15 million.
A dependable partner, particularly during times of crisis
In view of the exceptional situation resulting from coronavirus, Baloise has taken precautions in order to protect the health of its employees, customers, suppliers and partners. At the same time, it has worked hard in recent weeks to implement an action plan that ensures business can continue. To protect customers and employees, Baloise Bank SoBa will be reducing the number of branches in operation until further notice. Our branches in Solothurn, Olten, Grenchen and Dornach will remain open for urgent counter transactions. Nonetheless, customers are asked to withdraw cash from ATMs where possible and to use online banking, mobile banking, the telephone or email for their day-to-day banking needs. Insurance matters can also be dealt with by email or telephone. Baloise is thus doing everything it can to continue offering the best possible level of customer service.
So that resources can be used as efficiently as possible in this emergency situation, the conference call on the annual financial results of the Swiss business will now not take place. However, the media team is available to answer any questions.
Further information
- Media information at www.baloise.com
- Annual Report of the Baloise Group at www.baloise.com/annualresults
- Annual Report of Baloise Bank SoBa at www.baloise.com/soba
Contacts
Baloise Group, Aeschengraben 21, 4002 Basel, Switzerland
Website: www.baloise.com
Email:media.relations@baloise.com / investor.relations@baloise.com
Media Relations: Tel: +41 (0)58 285 8214
Investor Relations: Tel: +41 (0)58 285 8181
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