Sluggish financial markets reflected in KLP’s first half-year results
KLP achieved an investment result (the return in excess of that guaranteed by the company to its customers) of NOK -20.3 (7.2) billion in the second quarter. The return on the common portfolio was -2.1 per cent year to date.
The quarter in brief
- After the first half of 2022, the return was minus 2.1 per cent.
- Higher interest rates and a sluggish equity market have had a negative impact on the half-year results of KLP and its subsidiaries.
- The upturn in activity in hotels and shopping centres has contributed to a strong return on KLP’s properties.
- Financial buffers remain strong, and capital adequacy is excellent at 340 per cent.
“Rising inflation and higher interest rates are affecting the global economy. This has resulted in substantial movements in financial markets. We have solid financial buffers which safeguard customers’ savings during periods of negative market movements,” says Group CEO Sverre Thornes.
KLP’s total assets have increased by NOK 20.9 billion in the year to date, including NOK 17.1 billion in the second quarter, and amount to NOK 727.6 billion. The premium reserve increased by NOK 21.9 billion to NOK 508.1 billion over the same period.
Client surveys from second quarter confirms the company’s strong position. KLPs effort to establish a robust system for support for the complex framework that regulates public sector pensions is ongoing at full speed. This gives a foundation for better servicing to employers an employees with their pension schemes at KLP.
“Fast rising interest rates has had an immediate impact on valuation on our bond portfolio this period. This also means that forthcoming yields in bonds will add value to future results and our long-term financial strength,” says Group CEO Sverre Thornes.
Underlying performance of KLP's subsidiaries are good, and customer surveys show high customer satisfaction levels. Lower returns in financial markets have on the other hand lowered the results.
Contact persons for more information
Group Chief Executive Officer Sverre Thornes: tel. +47 977 44 007
Group Chief Financial Officer/Executive Vice President, Finance Aage Schaanning: Tel. +47 905 24 312
Finance Director Oliver Siem: Tel. +47 934 31 820
EVP Communication Sissel Bjaanæs: Tel. +47 932 56 350
KLP, the pension fund for Norway’s municipal employees, is the country’s biggest occupational pension fund with N0K900bn (€88bn) under management. KLP is a mutual company, owned by Norwegian municipalities, health trusts and publicly owned companies. KLP has strict self-imposed guidelines for responsible investments, climate, and sustainability, and has released one of the industry most ambitious net zero emissions roadmaps “The Road to Paris”.
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