Interim Report 05/08/2013
Outlook for the rest of 2013
Sampo Group's business areas are expected to report good operating results for 2013.
However, the mark-to-market results are, particularly in life insurance, highly dependent on capital market developments. The low interest rate level also creates a challenging environment for reinvestment in fixed income assets.
The P&C insurance operations are expected to reach their long-term combined ratio target of below 95 per cent in 2013 and achieve a combined ratio of 89 - 92 per cent. Nordea's contribution to the Group's profit is expected to be significant.
The major risks and uncertainties to the Group in the near term
In its day-to-day business activities Sampo Group is exposed to various risks. As a financial group the major sources of profitability and its variation for Sampo Group are market, credit and insurance risks. Their contributions to the Group's Economic Capital - used as an internal basis for capital needs - currently represent normal levels of 32 per cent, 45 per cent and 12 per cent, respectively.
Major unforeseen events or abrupt structural changes in the business environment may impact the profitability of Sampo Group or they can affect Group's ability to conduct its business activities. For example the continuing political and financial crises in Europe combined with slow growth may escalate in ways that can affect Group's activities unfavourably. This is, however, mitigated by the fact that Sampo Group companies have no direct exposures in sovereigns under pressure and have small exposure to banking sector outside the Nordic region.