The year progressed well for Etera Mutual Pension Insurance Company. The return on investments was good and solvency strengthened. Client bonuses are growing for the third year in a row.
“In terms of investments, 2016 was an eventful year. However, Etera’s investments yielded more stable returns than the markets. The return development was fairly stable throughout the year, which also strengthened our solvency,” says Etera’s Managing Director, Stefan Björkman.
The return on Etera’s investments was 6.6 per cent in 2016 (3.7% in 2015). The market value of Etera’s investment portfolio at the end of the year was EUR 6.1 billion (31 Dec. 2015: EUR 5.9 billion).
Etera’s solvency strengthened during the year. At year-end, solvency capital stood at EUR 837 million (EUR 751 million). The solvency ratio was 15.4 per cent (14.2%) and the solvency position was 1.4 (1.4).
Stronger solvency and cost efficiency are reflected in higher client bonuses. “Our client bonuses will increase substantially for the third year in a row,” says Björkman.
Investing in Finland
Investment returns were generated by multiple sources. The return on fixed income investments was 4.4 per cent (2.0%). The return on equity investments was 10.6 per cent (6.6%), while real estate investments generated a return of 8.7 per cent (4.2%). The return on other investments was 3.1 per cent (3.0%).
Finnish investments make up some 40 per cent of Etera’s portfolio. “We found good investments in Finland. During the year, we invested, for example, in forests in Central Finland and in the Mall of Tripla in Helsinki‘s Pasila district. And flats are under construction throughout Finland,” says Björkman.
Good results in customer work
The Etera 2020 programme is proceeding as planned. “Costs have remained in check, and the expense ratio for 2016 will improve from 2015 to approximately 75 per cent,” Björkman says.
Etera performed well in customer work and insurance sales. “The strong momentum in new insurance sales continued, and the insurance transfer rounds for the entire year were clearly positive,” Björkman says.
“I’m especially pleased that the recommendation rate and satisfaction with our services are at an outstanding level,” he says.
Improving customers’ ability to work every day
Etera continued its close co-operation with clients to prevent disability. “We provide coaching for our client companies’ supervisors at the Etera Coaching workshops. As a new service, we will be offering our clients ‘Sleep Coaching’ as an online service from March,” Björkman explains.
The new workspace Työhuone Pasila opened its doors in the autumn and is available to Etera’s clients. “At Työhuone Pasila we test and present the latest solutions that support work today and in the future. Well-being at work, coping at work and work satisfaction are strongly present,” Björkman stresses.
At the turn of the year, Etera adopted the pension processing system that is jointly used in the entire industry. “The transition to the new shared pension processing system went as planned,” says Björkman.
The Financial Supervisory Authority’s revised guidelines concerning pension companies’ well-being at work activities had little effect on the scope or principles of Etera’s well-being at work activities. “The Financial Supervisory Authority assessed our well-being at work activities as being of high quality, and therefore the transition to the new guidelines did not bring about major changes for us,” Björkman explains.
Investment allocation and returns 31 December 2016, pdf
Stefan Björkman, Managing Director, tel. +358 50 63219, email@example.com
The figures are unaudited, preliminary information on the financial statements. Etera’s financial statements for 2016 will be published on 8 March 2017. The online annual report will be released on 5 April 2017. Etera publishes its investment returns monthly at etera.fi/en/etera-about/financial-information.