Finland’s Varma reported that a 6% return on investments in the first quarter had lifted its solvency ratio to a record high, while fellow pension insurance companies Elo and Veritas also announced their solvency had ticked higher.

Releasing Q1 results this morning, Varma said its solvency level stood at 133.5% at the end of March, up from 129.3% at the beginning of 2021.

The Helsinki-based firm – along with Ilmarinen one of the two largest pension insurers in Finland’s earnings-related pension system – also reported it had received its first disability pension applications from individuals affected by the long-term symptoms of COVID-19.

Varma revealed it had processed six such applications, and one of these people had been granted a permanent disability pension.

Risto Murto, the pension provider’s chief executive officer, said: “Varma had the strongest first quarter in the company’s history, boosted by the accelerated growth of the global economy.”

Finland’s economy was enjoying a growth spurt, he said, riding on the wave of extremely strong economic growth in the US.

Varma said its total return on investments was 6% in the January-to-March period, compared with a 10% loss this time last year, with its assets under management growing to €52.9bn from €50.2bn at the beginning of this year.

The pension provider said its investment results had been characterised by a strong performance of both listed and private equity, as well as hedge funds, with private equity returning 16%, listed equities 9.2% and hedge funds 4.5%.

Murto said the firm expected to see a significant increase in the number of disability pension applications from those who contracted the coronavirus.

“It has only been over a year since the outbreak of the [pandemic], and disability pension is usually applied for after having received sickness allowance for one year, if the disability is prolonged,” he said.

Meanwhile, Elo – the third-largest pension insurer – reported a 3.9% return on investments, with the market value of assets rising to €26.8bn at the end of March, and its solvency ratio climbing to 125.0% from 123.7% at the end of December.

Hanna Hiidenpalo, Elo’s interim CEO, said: “Investment returns were at a good level and our solvency has improved since the turn of the year.”

Equities generated 7.8% in returns, fixed income investments made a -0.3% loss, and real estate produced a 0.9% gain, it reported this morning.

Veritas, the smallest of the four pension insurers, reported on Tuesday that its investments had made a 3.3% return between January and March, and its solvency level had risen to 129.6% at the end of March from 128.8% at the end of December.

The Turku-headquartered firm’s total assets grew to €4.0bn at the end of March, from €3.9bn at the end of 2020.

Of Veritas’ different asset classes, the highest return came from equities in the first quarter, at 7.6%, while property investments generated 1.0% and fixed income investments made a -0.3% loss, according to the interim report.

Ilmarinen is due to publish its Q1 report tomorrow.

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