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Norwegian life insurers suffer severe decline

NORWAY – Life insurance companies suffered a severe decline in their net financial income last year, accompanied by poor financial results, according to figures published by research institute Statistics Norway (SSB).

Between 1999 and 2000 insurers’ net financial income fell 76% from NOK48.4bn to NOK11.5bn. The value-adjusted result of all companies was reduced from NOK32.9bn in 1999 to a negative NOK8.3bn last year. Before allowing for allocation to customers and tax the result remains poor, falling from NOK10.2bn in 1999 to NOK6.5bn in 2000.

Earned premiums of Norwegian life insurance companies increased by 8.4% to NOK27.2bn last year from NOK25.1bn the year before. During the same period total assets of life insurance companies increased by 4.1%, with the total reaching NOK381bn at the end of 2000.

Despite the poor results, financial institutions including banks, insurance companies and state loan institutions found themselves with 20% more asset capital than the year before. The total assets held by financial institutions rose by NOK516bn to NOK3.1trn by the end of 2000.

Bank of Norway (Norges Bank) increased its asset capital from NOK505bn to NOK809bn, an increase of 60% during the year. Other banks ended up with a total of NOK1.353bn at the end of 2000, a 13% increase, while financing firms increased their assets by 34% to NOK285bn from NOK213bn.

Insurance companies managed to increase their lot from NOK464bn to NOK477bn, but state loan institutions lost 13% of their asset capital, with a decrease from NOK206bn to NOK180bn, during the year ending on December 31, 2000.

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