NORWAY – Mutually-owned insurer KLP says it is well placed to benefit from proposed changes in the Norwegian pensions market, but says it will mean hard work and a change in its approach.

“The board believes that KLP is very well placed to succeed in the market climate that will be created by the banking law commission’s recommendations,” Kommunal Landspensjonskasse said in its first-quarter report.

“But it will call for hard work and changes in the way we approach the market.” The banking commission in March proposed opening the market to greater competition.

KLP posted a first-quarter profit before distribution of funds to customers and owners of 496 million crowns (63 million euros) – compared to a loss of 212 million crowns in the first quarter of 2002.

“This is the third good quarterly result in a row, an expression of the investments throughout last year having been adapted to the high interest rate level in Norway at the time,” it says.

Its total assets amounted to 115.1 billion crowns at the end of the quarter, an increase of 2.4 billion crowns on the start of the year. Nearly 70% of the funds are invested in bonds and money market instruments. Five percent is in equities, nine per cent is in property and 16% is in lending.

Chief executive Bjorn Kristoffersen said: “KLP will be in a very good position to succeed in the market when the new rules for occupational pensions (in the public sector) are in place in the near future.”

KLP today proposed becoming a limited company, saying its competitive position would be strengthened and that owners would see the benefit of the “appreciating value of their shareholdings in the reorganised company”.

“At this stage, the Board has not found it appropriate to recommend the integration of KLP with another financial services group,” it added.