EUROPE - Nordea's Life & Pensions division saw a significant rise in the value of assets under management in the third quarter of this year, which the Nordic and Baltic banking group attributed to asset price growth, as well as net inflows.
In its interim report, the group said assets under management at its Life & Pensions division had reached a record level of €43bn, up 5% on the previous quarter and 19% compared with one year ago.
It said the "positive development" was a result of both strong asset appreciation and a net inflow of €0.3bn.
Profit within Life & Pensions surged 20% from the second quarter to the third this year to €95m from €79m, but was little changed when compared with the same period last year, when it reported profit of €94m.
Underlying this flat year-on-year profit performance for the division, total profit from traditional with-profits products fell to €77m in third quarter from €80m in Q3 2009, despite recovering from the €66m reported in the second quarter of 2010.
Profits from unit-link products, on the other hand, were higher year-on-year at €21m in the third quarter versus €17m.
Because of the "solid" investment performance, Nordea said the division had strengthened its financial buffers, which ended the third quarter at €1.75bn, up 17% from the previous quarter.
This corresponded to 7.1% of technical provisions and was 1 percentage point higher than the previous quarter, it added.
Sales at the division continued at "a high pace" in the third quarter, with gross written premiums of €1.18bn.
"However, the exceptional strong sales of unit-linked products from the first half of the year did not continue in the third quarter," the group said, adding that this had led to a fall in total gross written premiums of 10% compared with the second quarter, even though the figure was 12% higher than third quarter last year.
Within the reported €43bn of investment assets, the proportion of unit-linked assets has risen gradually over the quarters in the last 12 months to stand at 31% in the third quarter, after 29% in Q2 and 26% in Q3 2009.
The proportion of assets held in bonds has declined to 48% in Q3 2010 from 54% in the same period the year before.