One-off surpluses boost HNB Assurance first half profits
HNB Assurance PLC’S reported higher profits for the quarter ended June 30, 2018 (2Q18) amid a modest growth in the premium incomes but the six months profits soared due to one-off surpluses in the life fund.
The insurance subsidiary of Hatton National Bank group, Sri Lanka’s second largest private lender, reported a profit after tax of Rs.106.3 million or Rs.2.13 a share for the April–june period on a gross written premium (GWP) of Rs.2.1 billion.
The bottom line was up by 4.0 percent year-on-year (YOY) and the gross written premium income was up by 9.0 percent YOY.
However, notable financial performance was seen in the company’s six months profits, which were lifted by one-off surpluses arising as a result of the insurance industry valuation rule change and the first quarter valuation of the life fund under new valuation method.
HNB Assurance reported a 357 percent YOY jump in after tax profit for the six months ended June 30, 2018 to Rs.805.1 million or Rs.16.10 a share.
This profit includes Rs.209.8 million transferred to the shareholder fund as surplus out of the nonparticipating fund of the life fund on the recommendations made by the life insurance consultant actuary.
Meanwhile, another Rs.381.1 million was transferred to the shareholder fund as one-off surplus attributable to policyholder non-participating fund of the life fund as per the direction No.16 of the Insurance Regulatory Commission of Sri Lanka.
Similar transactions were not carried out during last year as shown in the comparative figures, the company said.
The earnings per share barring the one-off surplus for the six months was Rs.8.48 compared to Rs.3.52 a share a year ago.
As of June 30, 2018, HNB Assurance had a life fund of Rs.11.6 billion and a non-life fund of Rs.2.6 billion, up from Rs.10.9 billion and Rs.2.4 billion each in December 2017.
Meanwhile, for the six months, the company earned an investment and dividend income of Rs.904.7 million from its financial investment portfolio, up 22 percent YOY.
The company paid claims and benefits of Rs.1.45 billion compared to Rs1.04 billion during the corresponding six months, last year.
By June 30, 2018, HNB held 59.99 percent stake in HNB Assurance.
The Alliance Finance Co PLC (AFC) recently announced the appointment of Ramani Ponnambalam as Chairperson replacing Sunil Karunanayake who passed away recently.
Ponnambalam was appointed to the Board of Alliance Finance Co PLC in 2011 as a Non-executive Director and has served as a Member of the Remuneration Committee and Related Party Transaction Review Committee. She is therefore well acquainted with the evolution and practices of AFC.
She has previously served as Director of Mclarens Holdings Ltd, GAC Shipping Ltd and GAC Logistics Ltd. She is currently Managing Director of Macbertan (Pvt.) Ltd and is a Director of Macbertan Holdings Ltd and overlooks the HR and Admin functions of Macbertan.
She is also a Non-executive Independent Director and Audit Committee Member of The Kingsbury PLC and Amaya Leisure PLC. In addition to these Board appointments, she also currently serves on the Board of Pidilite Lanka (Pvt.) Ltd, a Boi-approved joint venture (JV) company as its local Director. Ramani Ponnambalam functions as Board Member and Joint Secretary of Women’s Chamber of Industry and Commerce (WCIC) and is passionately involved in the Development of Women Entrepreneurs through WCIC.
Most of her leisure activity is spent as the President of The Classic Car Club of Ceylon which is the Country Representative of FIVA (Federation Internationale Vehicules Anciens).
Ramani has held several Senior Management positions in large private sector entities and has undertaken key roles in the local and international negotiations for securing and developing business opportunities in Sri Lanka Industry.
She is a Past Student of Bishop’s College Colombo and graduated from the Singapore Management University obtaining an Executive Diploma in Directorship.