Finland’s Elo reports investment return of -3.7% in 2022

Written by Adam Cadle

17/02/2023

Finnish pension insurance company, Elo, has revealed that its investments returned -3.7% in 2022, down from 14% in 2021.

The result of investment activities at current values was -€1,493m, down from a positive result of €1,563 the previous year.

Elo attributed the negative return to the weakening of the general economic environment, with economic growth slowing due to the tightening of financial conditions, and increased inflation and interest rates.

The return on Elo’s equity investments was -6.9%, down from 26.6% in 2021, while its return on unquoted equity investments was 20.2%, down from 24.6%.

Its return on fixed income investments fell from 1.7% in 2021 to -2.8% in 2022, and while its return on real estate was positive at 5.3%, this was still lower than the 7.5% it achieved in 2021.

Despite the negative return in 2022 as a whole, Elo achieved a positive return in the fourth quarter of the year.

The market value of Elo’s investments fell from €29.4bn in 2021 to €28.2bn in 2022.

Its solvency ratio also fell during the same period, from 128.1% to 121.4%, while the solvency capital was 1.5 times the solvency limit, down from 1.6 times the year prior.

Premiums written amounted to €4.3bn, while pensions and other compensations paid were almost the same, at €4.1bn.

“The total return on Elo's investments in 2022 was negative, as the returns of most of the listed asset classes were weak,” commented Elo executive vice president, Hanna Hiidenpalo.

“In the last quarter of the year, we already achieved a positive return. The return on investments was improved by diversification into real estate, real estate and infrastructure investments, which had a positive return.”

Related Articles