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Sampo-Leonia´s operating profit doubled to 1,6 billion euro
Press Release - 28 Feb 2001 at 12:30 PM
The significant growth of return on investments which mainly consisted of profit from sales of shares and dividend income raised the results of all three business areas.
The results of banking operations improved also as a result of the growth in net income from financial operations and of the favourable development of securities transactions and foreign exchange dealing. The 9 per cent increase in the net income from financial operations was mainly due to the rise in interest rates and growth of the credit portfolio. On the other hand, net income from financial operations was weakened by the increase in funding costs as a result of decreasing deposits. The 7.7 per cent drop in deposits was caused by deposit interests becoming subject to taxation at source, the ending of the joint venture with the Finland Post and a change of savings behaviour. Savings in the Group's mutual funds increased by 42 per cent.
Life insurance showed a good overall result thanks to investment operations. As a result customers were granted a 6.3-6.6 per cent return depending on the type of insurance. Life insurance savings continued to grow, since technical provisions increased by 20.1 per cent.
In non-life insurance the comparable result of domestic direct insurance improved. The profitability of motor third party liability insurance improved noticeably, however, the profitability of statutory workers' compensation insurance and fire and other property non-life insurance declined slightly. Direct insurance of foreign operations weakened the overall profitability of non-life insurance. The Group received 26 claims exceeding 2 million euro each, of which 22 concerned loss or damage occurred overseas.
Sampo-Leonia's A share is quoted on the Helsinki Exchanges. The unit price of the share has risen so that it is now the second highest on the stock exchange list. Therefore, the Board of Directors of the company will propose to the Annual General Meeting that each share be split into five shares.
The Stock Exchange Release on the closing of the accounts is published in full at www.sampo-leonia.fi.
ADDITIONAL INFORMATION: Taru Narvanmaa, Head of Investor Relations, tel. +358 10 514 0030, mobile +358 50 590 9398