Fubotv earnings beat by $0.10, revenue topped estimates
Storebrand ASA reported robust financial results for Q2 2025, showcasing resilience amid challenging market conditions. The company achieved a 16% year-on-year increase in operating results, reaching $53 million, and delivered a financial result of $474 million. Storebrand’s stock price rose by 2.31% following the announcement, reflecting investor confidence in its strategic direction and financial stability. According to InvestingPro data, the company appears undervalued with a P/E ratio of 9.04 and offers an attractive dividend yield of 3.71%. The stock has demonstrated remarkable momentum, delivering a 161.68% return year-to-date.
Key Takeaways
- Storebrand’s operating result increased by 16% year-on-year to $53 million.
- The company achieved a solvency ratio of 200% and an annualized return on equity of 18%.
- Assets under management reached $1.5 trillion, indicating strong growth in its core business.
- The stock price increased by 2.31% in response to the earnings report.
Company Performance
Storebrand demonstrated strong performance in Q2 2025, driven by a 10% top-line growth year-to-date. The company’s strategic initiatives, including expanding its presence in the occupational pension market and making significant renewable infrastructure investments, have bolstered its market position. Storebrand’s insurance portfolio grew by 21% over the past year, further solidifying its competitive edge.
Financial Highlights
- Group cash-based earnings: $27 million
- Operating result: $53 million (16% year-on-year increase)
- Financial result: $474 million
- Solvency ratio: 200%
- Annualized return on equity: 18%
Outlook & Guidance
Storebrand has set ambitious targets for the future, aiming for a $5 billion result by 2025. The company plans to continue its focus on sustainability and the green transition, with a Capital Markets Day scheduled for December 10 to outline further strategic initiatives. The cost guidance has been adjusted slightly to €6,900 million, reflecting ongoing investments in growth and innovation.
Executive Commentary
CEO Odd Aril Grefstad stated, "Despite the market turbulence, Storebrand delivers a record strong operating result," highlighting the company’s ability to navigate challenging conditions. CFO Lars Lede Sol expressed confidence in achieving Storebrand’s 2025 ambitions, underscoring the company’s strategic focus and financial discipline.
Risks and Challenges
- Market volatility: Continued turbulence could impact investment returns.
- Regulatory changes: Potential shifts in pension regulations may affect operations.
- Competitive pressures: Growing competition in the Nordic financial services market.
- Economic conditions: Macroeconomic factors could influence consumer behavior and financial markets.
Storebrand’s Q2 2025 earnings call underscored its strong performance and strategic focus, positioning the company well for future growth despite market challenges.
Full transcript - Storebrand ASA (STB) Q2 2025:
Johannes, Moderator/Host, Storebrand: Good morning, ladies and gentlemen, and welcome to Storebrand’s Second Quarter Results Presentation. As usual, our CEO, Odd Ari Ligrevsta, will present the key highlights of the quarter, followed by CFO, Lars Lede Sol, who will dive deeper into the numbers. At the end of the presentation, participants in the Teams’ webinar will have a chance to ask questions. Details on how to join the webinar are found on the Investor Relations website. But without further ado, I give the word to our CEO, Odd Aril Grefstad.
Odd Aril Grefstad, CEO, Storebrand: Thank you, Johannes, and hello, everyone. It has been a relatively turbulent market in the second quarter, where asset unit management levels at times has been significantly lower than at the end of the quarter. The so called Independence Day and uncertainty around global trade and geopolitics still looms over the markets, also going into the second half of twenty twenty five. Despite the market turbulence, Storebrand delivers a record strong operating result as the business continues to grow double digits. I am pleased to see that we gained trust among new and existing customers.
And we are well on track to deliver on our $5,000,000,000 result target for 2025. Now let me give an overview of the second quarter’s highlights. Storebrand’s group cash based earnings amounted to $27,000,000 in the quarter. The operating result was 53,000,000 up by 16% year on year. The operating result was driven by continued strong growth in savings volumes and strongly improved insurance results, in combination with increased market share.
The financial result of $474,000,000 was made up by profit sharing and return on company capital. In sum, this has led to an annualized return on equity at 18% in the quarter and a robust balance sheet with a 200% solvency ratio. The strong balance sheet means continued repatriation of capital to shareholders. We plan to conduct SEK 1,500,000,000.0 in share buybacks across 2025, split into two tranches of $750,000,000 each. The first tranche was completed on June 26.
The second tranche will be initiated today and end no later than December 19 this year. The long term ambition is to conduct annual share buybacks of $1,500,000,000 in total 12,000,000,000 until the end of 02/1930, in addition to increasing annual dividends. As many of you are familiar with, Storebrand aims to take three commercial positions in the markets we operate in: a, to be the leading provider of occupational pensions in both Norway and Sweden and b, to be a Nordic powerhouse in Asset Management and C, to be a fast growing challenger in the Norwegian retail market for financial services. These positions are strengthened by our strategic enablers, people, sustainability and digital front runner, together unlocking additional growth. Let’s look at the growth delivered in the quarter.
I’m pleased to report that we again delivered double digit growth across the business, driven by both structural growth and growth in market shares. Now let me go into further details on our growth areas and share some highlights from the quarter. And let me start with our corporate customers. Our corporate business in Norway have reached an agreement to acquire a portfolio from Aspida Insurance. This acquisition will add new customers and annual premiums of around 40,000,000, further strengthening our market presence and position in the SME market.
Within public occupational pension, we have submitted bids totaling SEK 7,000,000,000 in 2025 so far, with the expected tender volume for the full year projected to exceed $15,000,000,000 This demonstrates that the market is gradually opening in advance of the expected ruling from the European Union body, ESA. In the second quarter, there has been a notable increase in activity among closed pension funds. We have successfully signed one transfer in the quarter and worked closely with other closed pension funds. For Storben Asset Management, we are proud to have exceeded $1,500,000,000,000 in assets under management, reaching a new record level. This milestone reflects our strong market position and ability to make attractive solution for our customers.
Our active funds have generated strong performance based income, amounting to $91,000,000 in the quarter and $149,000,000 year to date. This demonstrates our ability to deliver value to our clients through active management. Let me then turn to the Norwegian retail customers. We have now reached a 7.4% market share in the Norwegian P and C market, up from 7.1% the previous quarter. Our bank lending portfolio has seen a year on year increase of 12%, reaching 92,000,000,000.
This growth reflects our increased ability to attract and retain retail customers with a branchless multichannel offering. We have successfully integrated our pension solutions into the Kron application, making it available to over 500,000 pension customers. This integration will not only enhance customer experience, but also provides opportunities for further growth and cross sales. Let me end with some further reflections on the development within Insurance overall. Profitability in the Insurance segment improved during the quarter.
We delivered a combined ratio of 91%, down from 97% in the first quarter, representing a significant step towards reaching our 90% to 92% combined ratio ambition for the full year. The insurance portfolio grew 21% over the last twelve months and is now close to SEK 12,000,000,000 in annual premiums. The portfolio quality is increasing with the growth mainly stemming from short tailed P and C business. I’m very pleased with how the organization has developed and been able to take on this growth and how we use our group synergies within capital, brand and distribution to strengthen our market position. And with that, I leave the word back to you, Johannes.
Johannes, Moderator/Host, Storebrand: Thank you, Odarel. Now let’s take a closer look at the numbers. Lars, please go ahead.
Lars Lede Sol, CFO, Storebrand: Thank you, Johannes. The quarter result of 1,427,000,000.000 is satisfactory and confirms the positive development in the business. In particular, the operating result is strong with a record $953,000,000, benefiting from improving Insurance results as expected. The financial result is also strong following benign financial markets, which have given profit sharing in the Norwegian guaranteed products and good returns in company portfolios. The annualized return on equity for the quarter, which ended at 18%, confirms Storebrand’s continued trajectory towards a capital light business.
The solvency margin is stable, buffers have been strengthened and the expected return on the guaranteed portfolios has a 180 basis point spread to the average guaranteed rate of return, further strengthening the solidity and long term profitability of the guaranteed business. The solvency margin of 200% has been positively affected by strong post tax results in the quarter as well as lower capital requirements for the bank under CRR III. Regulatory assumptions, volatility adjustment and symmetric equity adjustment had a negative effect. The initiation of the second tranche of the share buyback program starting today gives a negative effect of two percentage points, not shown in the figure at the end of the quarter. With the current level of solvency, buffers and interest rates, the solvency margin is very robust to fluctuations in the financial markets.
The growth in the business continues and the top line growth for both the second quarter and year to date was 10%. The insurance result is up 60% compared to the second quarter last year. Price increases and other measures are giving the expected effects. Storebrand has double digit growth ambitions for 2025 and a corresponding cost guidance of 6,800,000,000.0 for the full year. A cost reclassification will lead to €100,000,000 in cost increases for 2025 compared to last year, and the guided €6,800,000,000 therefore corresponds to 6,900,000,000.0 under new recognition.
This change does not impact results as there is a corresponding increase in income. The underlying cost development since the beginning of the year is broadly in line with plan. Performance related costs, record strong insurance sales and currency effects have led to an additional SEK 80,000,000 in costs compared to the guided cost level year to date. The increase in operational cost compared to last year is explained by the inclusion of AIP, strong performance results, which lead to bonus accruals and continued strong sales with corresponding sales commissions within Insurance. Financial results are strong following increased profit sharing in Norwegian guaranteed portfolios and good return on company capital.
The tax charge for the quarter of 15% was below normal due to currency movements and asymmetry in how tax is calculated on assets and currency hedges. Our tax guidance is still 19% to 22%. This table shows the same numbers as on the previous page, but split into the business lines, savings, insurance and guaranteed. All business lines show positive development in the quarter and year to date, adjusted for the sale of Storebrand Health Insurance last year. I will comment on each area in the coming slides.
The Unit Linked business shows continued growth in premiums and reserves. The margins are down by approximately three percentage point three basis points from last year. The recorded margin fall this quarter is partly of a technical nature as there was a significant drop in market values at the beginning of the quarter, leading to lower AUM fees. Market returns and AUM development have been positive since the April. The Asset Management business reports record AUM at the end of the quarter and strong performance results.
Longer lead times in attracting new capital in the current financial environment have caused delays in current fundraising. This has led to a negative result of around $30,000,000 in the quarter and $50,000,000 year to date in AIP. We still expect a positive result for the second half, but not enough to make up for the negative result in the first half. The bank continues to grow with satisfactory margins. The insurance business is delivering satisfactory results after a challenging couple of years.
In particular, the retail P and C business is developing as planned. We continue to grow the number of customers despite steep price increases and our market share, which is recorded with a quarterly delay, has gone up from 7.1% to 7.4%, as Sodari Lohsan mentioned. Growth comes with a cost, and strong sales have led to increased sales provisions. The increased sales cost weakens the combined ratio by approximately two percentage points. We maintain the ambition to deliver 92% or less in combined ratio for the full year.
In Guaranteed, results are satisfactory. Worth to note this is profit sharing improving in benign financial markets, especially in Norwegian paid up policies. Buffers are up by 5,400,000,000 following strong financial markets. Company portfolios have given good returns in the quarter and year to date. Storebrand is committed to science based targets and the green transition.
We are ahead of our internal sustainability targets. Worth to note here is that this quarter we were, as the only Norwegian company, ranked amongst the 100 most sustainable companies in the world by Times Magazine. Furthermore, we finalized two new renewable infrastructure investments in the Storebrand infrastructure funds. With the results we present today, we have good momentum in the group, and we are well on our way to deliver on our 2025 ambitions. Finally, we hereby invite you all to our Capital Markets Day in Oslo on December 10.
The event will be hybrid and may be followed online, but we do hope that as many as possible will be able to make a trip to Oslo to meet us in person. I would also like to invite you to contact us in the coming months with any suggestions you may have for topics that you want us to cover on the Capital Markets Day. And then I hand it back to you, Johannes.
Johannes, Moderator/Host, Storebrand: Thank you, Lars. We are now happy to take questions from our audience. Please use the raise hand function in the Teams webinar to be placed in line to ask a question. And the first question comes from David Barma in Bank of America. Please go ahead, David.
David Barma, Analyst, Bank of America: Hello. Thanks for taking my questions. Sorry, my camera doesn’t seem to be loading. So my first question is on the insurance result where at a store brand for Secrean, we’ve moved from many tough quarters to the best one in many years. Can you give us some color as to how much frequency and weather helped this period and whether you see this as a sustainable result for the rest of the year?
And then on disability, it’s a bit hard to track the performance of disability insurance now. So can you give us an update on performance within the insurance segments? And just linked to that, the risk result and guaranteed pensions was a bit weaker. Was that a matter of disability as well? Or was it more on the longevity or the mortality side this quarter?
Thank
Lars Lede Sol, CFO, Storebrand: Thank David. On the frequency, the frequency has been slightly lower in the second quarter than it was last year. And obviously, we don’t know about how frequency is going to develop going forward. So that’s but it has been a relatively good development on frequency in the second quarter.
You started mentioning that these were record results. As we’ve said now several quarters after each other is that we will reprice the portfolio to match the claims development. And now we see that the price increases are catching up with the bad results we or the weak results we had previously and moving much more according to plan. And we will continue to reprice to match the experience we see on the claims side. On disability, we the main product lines, the disability insurance linked to unit linked plans in Norway and Sweden are developing very much according to plan and now has acceptable profitability.
We still have some smaller business lines with longer tails that we are still repricing, and we will experience some weaker results, including what you see in the guaranteed, which is then linked to disability. It takes a little bit more time to reprice these adequately, but these are smaller product lines. The main product lines, the disability linked to pension as well as P and C is now developing very much according to plan and showing acceptable profitability.
Johannes, Moderator/Host, Storebrand: Thank you, David. We have a question from Ulrik in Nordea. Please go ahead, Ulrik.
Ulrik, Analyst, Nordea: Yes. Thank you. So just two quick ones from me. I was just wondering about the unit linked Norway margin outlook. We noticed the margins are sliding maybe marginally, but a little bit and the transfer balances remain also slightly negative.
Should we expect further pressure to margins for this segment? And then secondly, I just wonder about the profit sharing in Norway in the quarter. It was very high. I think we expect it more to be back end loaded. Is this some sort of extra on top of what we can expect later this year?
Or have you taken out some of the potential for 25% already?
Lars Lede Sol, CFO, Storebrand: Thanks, Ulrich. On the unit linked margin in Norway, the financial markets had a significant dip in the beginning of the quarter and then it came up gradually afterwards. Similarly, our AUM, as a consequence, fell significantly in the beginning of the quarter and came back up against during the quarter. So when you take a measurement from the beginning of the quarter and the end of the quarter in terms of the average balance, but you have income that is impacted by the fall during the quarter, you get like a technical weaker result. So there is margin pressure within Unit Linked, and we’ve had over the last few years a slide in margins, but the significant slide or the significant fall you saw in this quarter is not representative for the what we have of expectations going forward.
Executive, Storebrand: Yes. I think it’s very important. And the income is based on a daily basis here. And you have the average of the starting point and the last point, and that, of course, gives some effects in such a turbulent quarter as we have seen in the second quarter. And to answer also on the transfer balance.
There is competition in this market. We are very focused on profitability. And we see that some of these elements has been transfer out, but we are very comfortable about the profitability and that we keep the profitable customers in store brand.
Lars Lede Sol, CFO, Storebrand: In terms of the profit sharing in Norway, the way we use it look at it, we make an estimate in every quarter, the actual performance or returns in that quarter, and then we normalize it for the rest of the year, and then we make an assessment of what the profit sharing would be based on where we stand today. So the first quarter, the financial results were weaker than normalized. So we had lower profit split on an expected basis. Now it has been a good quarter and the calculated expectation for the year has gone up. But it’s not like we are this is purely mathematical.
This is not something we push forward do at our own discretion in terms of how we put this by quarter.
Executive, Storebrand: And you might also say that we I think we guided and started the year at around €300,000,000 in profit sharing in Norway and €300,000,000 in Sweden. And based on normal booked return, that will still be the case. But so far, it’s a bit higher booked return compared to that. And if that is the outcome of the end of the year, you might have some upside on these numbers. But that depends on the final booked return, of course.
Ulrik, Analyst, Nordea: Okay. Thank you.
Johannes, Moderator/Host, Storebrand: Thank you, Ulrik. We have a next question from Hans in Danske Bank. Your line is now open, Hans.
Hans, Analyst, Danske Bank: Yes. Good morning and thanks for taking my questions. So first question is on sort of following up from the previous question on the average AUM, and it’s obviously impacting your unit linked business negatively on the margin. But if I look at the asset management segment, the margin looks quite good if we were to account for sort of the average and daily fee income earning. So could you maybe just give some details on underlying what the actual average margin would have been if you take the current sort of one point to $1.5100000000000 AUM?
And then my second question is regarding sort of your delivery this quarter. Have an ROE of north of 18%. There’s obviously a bit of a tax effect, but doesn’t seem to be any big kind of funnies in numbers. So with the upcoming CMD, do you think this is kind of a good quarter to
David Barma, Analyst, Bank of America: sort of
Hans, Analyst, Danske Bank: demonstrate what you can achieve in the short term here going forward? How should we think around that?
Lars Lede Sol, CFO, Storebrand: In terms of the earnings in Storebrand Asset Management, we’ve had good performance fees calculated in the quarter, so very good performance both in Skagen and in Delphi, which lifts the earnings. Also, the event driven earnings has been much stronger in the second quarter than they were in the first quarter. So those are elements that lift it. So you will have some of the same dip effect, I guess, on Storebrand Asset Management, but that will be neutralized by the fact that we have good performance and good event driven income in the quarter. So we continue to try to have between eighteen and twenty basis points in net margin now in gross margin in Asset Management, which we’ve been able to maintain for many, many years.
Executive, Storebrand: When it comes to return on equity, very pleased to see the 18% return on equity in the quarter. And it as Lars said, it shows really the change in the business mix towards the capital light business in store brand. Then again, as you said, low taxes this quarter. We also have a bit volatility in the IFRS equity. So we will look thoroughly into this, what to expect going forward.
But the Capital Markets Day is the right timing for us to update on these different areas.
Jan Erik Gjerlan, Analyst, ABG: Thank you very much.
Johannes, Moderator/Host, Storebrand: Thank you, Hans. We have the next question from Thomas Swenson in SEB. Please go ahead.
Thomas Swenson, Analyst, SEB: Yes. Hi, good afternoon. So two questions from my side. First, just on back to the profit split there in Guaranteed. So given the arguments there, is it really fair to say that, like it is did last quarter, profit splits would be back end loaded since you argue that higher returns will mathematically give higher profit splits independent of quarter?
And the second question, in insurance, you saw your very strong traction there in the Norwegian market. So at what market share would you consider you more like a not a challenger anymore and sort of satisfied with the market share and when we could expect more normalized distribution costs?
Executive, Storebrand: I can start on the profit sharing part. In Sweden, it’s completely automatic. So it just goes mark to market and it goes into the results. In the Norwegian line of business, it’s a little bit more discretionary, but clear rules around it. So it means that you should not expect us to change the guiding, although a little bit more of the result has come earlier this year than what you have been used to seeing previously.
Executive, Storebrand: When it comes to insurance, I think we are very pleased to see the growth, having now 0.3% increase in market share in one quarter is very strong in this market. We have not put a ceiling for our market share in insurance, and we are very pleased to see the growth coming through for years actually and will be a challenger, as I see it, for years in this market.
Thomas Swenson, Analyst, SEB: Okay, understand.
Johannes, Moderator/Host, Storebrand: Thank you, Thomas. We have a next question from Farooq Hanif in JPMorgan. Please go ahead, Farooq.
Odd Aril Grefstad, CEO, Storebrand0: Hi, everybody. Thank you very much. Two questions on insurance. So my first question is, are you still seeing on a written basis, as in your gross written premium today, the pricing trends going well ahead of risk, so claims frequency and inflation. And hence, are we gonna continue to see margin expansion beyond 2025 theoretically?
Obviously, you’ve given very clear guidance for 2025, but just theoretically, is this something that could overshoot maybe expectations? And then secondly, in 2Q, you’ve mentioned obviously benign weather and good frequency. To what extent has that deviated from expectations? So can we say there’s a bit of like incredibly good luck in any part of your 2Q combined ratio? Or is it just like Farooq, that’s a silly question because it is what it is and you’re giving new targets.
So if you could just talk around that, that would be helpful. Thank you.
Lars Lede Sol, CFO, Storebrand: Thank you, Farooq. So the pricing is based on the last couple of years’ trends and experience. So there will be a bit of a you will have a tailwind on the pricing compared to the development in the market, and it’s likely that there will be some overshoot if the trend changes. And we’ve talked about the length of the tail in this business. Basically, you reprice the P and C business on an annual basis.
It does it’s done throughout the year. So you have a twelve- to eighteen month tail there. On benign weather, yes, the weather has been okay and frequency has been slightly lower than expected in the second quarter. We obviously have no idea what the weather is going to look like or the frequency is going to look like in the next coming quarters.
Executive, Storebrand: But I think to use the word incredibly good luck, that would probably be a little bit
Lars Lede Sol, CFO, Storebrand: too strong.
Executive, Storebrand: So it’s quite along the trajectory we have expected, but as Lars said, with maybe a little bit lower frequency.
Executive, Storebrand: And it’s, of course, helped We a see that inflation now comes down in Norway. We also see that we have had also headwind when it comes to currency effects. That has also changed. And on top of that, we see that the frequency And of course, this is helpful for insurance results going forward also as well.
Lars Lede Sol, CFO, Storebrand: I can add one more thing. And you know the very significant torrential rains we had in 2023, that is now built into the expectations going forward that you will have these kind of extreme events from time to time with the climate changes taking place generally. So I think we and everyone else are looking at improving margins in normal quarters in order to have some extra buffer to lean on if you have another extreme weather event that is more likely now than it has been in the past.
Odd Aril Grefstad, CEO, Storebrand0: So just to be really clear about the first answer you gave, you’re still writing ahead. You’re still correcting in what you’re writing today in terms of the pricing that you’re setting, which will earn over the next twelve to eighteen months. And if unless you have a shock in inflation and frequency that’s negative, that suggests that there could be underlying some further improvement continuing next year. That’s kind of what you’re saying?
Lars Lede Sol, CFO, Storebrand: That’s correct.
Odd Aril Grefstad, CEO, Storebrand0: All right. That’s really helpful. Thank you very much.
Johannes, Moderator/Host, Storebrand: Thank you, Faruk. We have a next question from Jan Erik Gjerlan in ABG. Please go ahead, Jan Erik.
Jan Erik Gjerlan, Analyst, ABG: Thank you for taking my questions as well. And also, I’m back on the insurance side. I would talk more about the hit ratio and how you’re developing there and when will you walk do more volume versus price increases in your sort of premium growth expectations? As you saw in Sedikj this morning also having a fantastic result with higher level of price increases. How much is today price driven versus volume?
And how would you sort of try to walk going forward when it comes to to price versus volume, and how is your hit ratio then in infecting these kind of arguments? That’s my first question. The second one is on the total financial return you guided on roughly 300,000,000 for Sweden, roughly 300 for Norway, and somewhat for for the corporate company portfolios. Is the sum of that expectation what you’re sort of leaning towards when it comes to the this year expectation? Or is it just, as I say, a mark to market effect on the corporate portfolios and on in Sweden, and then it’s more discretionary for Norway?
Thank you.
Lars Lede Sol, CFO, Storebrand: In terms of insurance, the like in the last couple of quarters, about two thirds or so has been price increases and about one third has been volume increases. And you obviously see the increase in premiums, which has been 21%. And you see that our market share grows by 0.3% per quarter. So then that equates to about twothree coming through as price increases and the rest is volume increases. In terms of the profit split, I’m not sure I fully understood your question.
Executive, Storebrand: I can take the and also very quickly on insurance. I think it’s also when we look at the balance, we still see that we have retention in the 90s. So we see that the customers are staying with us with also the price increases we are seeing in the market today.
Lars Lede Sol, CFO, Storebrand: Yes. The churn rate has not really gone up with the price increase in the last few years.
Executive, Storebrand: On the profit split, Jan Erik, could you repeat what’s your question if we keep the guidance on the total sum?
Jan Erik Gjerlan, Analyst, ABG: Exactly.
Executive, Storebrand: Yes.
Jan Erik Gjerlan, Analyst, ABG: Yes. Because as I said, some of them is mark to market driven as Sweden and your company portfolios, Norway is maybe more discretionary. So the total guidance, is that still what you should look at as your best estimate for the second half? Or should we look at a higher level as you also could end up with?
Executive, Storebrand: I think it’s fair to Sweden to look at the guidance. Norway, we are booking it a little bit ahead. And then as Odarel said, we need to look at financial markets throughout the rest of the year. If it’s relatively in with normalized risk premiums, I think you should expect around the 300,000,000 level. When it comes to the company portfolios, we are a little bit ahead given the change in general interest rate level since we made the guidance in 2023.
So a little bit ahead on that compared to the original guidance.
Jan Erik Gjerlan, Analyst, ABG: And on the heat ratio, how is your sort of seeing these days? Because now the Norwegian South Swiss seem high increases in prices for, let’s say, almost two years. So is your HIT ratio higher these days, or is it lower? Is it stable? And what are you doing to sort of get the higher HIT ratio if you’re not happy with it, even though we have a good sales cost, as I say?
Lars Lede Sol, CFO, Storebrand: We measure every day churn rate in the portfolio and price increases going through in the portfolio. And we have a good balance between the two now. And as you’ve seen from Trig and Jan Seriga today, we’re all raising prices to match with the experience that we’ve had over the last few years. So it’s basically the competitive landscape is relatively stable, but in our favor compared to it has not changed significantly as a consequence of the premium increases.
Jan Erik Gjerlan, Analyst, ABG: And of
Executive, Storebrand: course, having the capital synergies we have in store brand and having a target of 90% to 92% in combined ratio, it’s somewhat higher than our competitors. And we are in a very good and strong competitive position and very pleased to see the growth we have in insurance these days.
Jan Erik Gjerlan, Analyst, ABG: Thank you.
Johannes, Moderator/Host, Storebrand: It seems like we have some additional questions from David Barma in Bank of America. Please go ahead, David.
David Barma, Analyst, Bank of America: Yes. Hello again. Thank you. Just two follow-up, please. Firstly, on the cost ratio in insurance.
So should we expect the close to 17% cost ratio of Q2 to gradually normalize in coming quarters closer to the 16% or even a little bit below if we adjust for the cost that you front load? Or is that more of or is that more driven by the volume components and so should take maybe a little bit longer to normalize? And then secondly, just on the last question on the investment results in the company portfolio. This was very good and going up in a low rate environment in Q2. Was there anything specific this quarter?
Or maybe could you give us the gap between your reinvestment rates and your book yield for the company portfolio? Thank you.
Executive, Storebrand: Yes. I’ll just start on the insurance side. I think as long as we are growing faster than the market, you will could expect that, that will affect the cost ratio of the company and will keep it at this level, all else equal. But then we’ll, of course, also see that we are scaling the business. And when we look into the future, we expect the cost ratio, all else equal, to go down.
And then the speed of the cost ratio going down will depend a little bit on how much market share and how much sales we are doing in this period.
Executive, Storebrand: Yes. But then again, we don’t do any deferred acquisition costs in Norway. And a very large part of the cost ratio is sales costs, meaning that if we have now leveled out and did not go for increased market share, you will quite soon have seen a quite strong drop in our cost ratio and then in the combined ratio. That’s also why we have guided on this this extra 2% in combined ratio based on the extraordinary sales out of what we saw last year.
Lars Lede Sol, CFO, Storebrand: On company portfolios, they are invested in basically money market instruments with a three to six months duration, and they yield basically money market rates plus a credit spread. In this quarter, we’ve seen a slight decrease in rates and a slight decrease in credit spreads. So you have a little bit of a positive mark to market effect both on credit and on interest rate level. However, you can with a very it’s a short duration money market portfolio invested in credit bonds, where you should expect NIBOR plus a small spread.
David Barma, Analyst, Bank of America: Thank you.
Johannes, Moderator/Host, Storebrand: Thank you, David, and thank you for your attention today. It looks like we have covered all the questions, so that wraps up our presentation. Our next set of results will be announced on October 22, and we look forward to seeing you again then. Thank you for attending, and goodbye.
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