A half-year with significant growth and solid investment returns

PFA’s performance in the first six months of 2021 was characterized by significant growth in customer funds and payments as well as a solid investment return of DKK 13.4 billion

During the first six months, PFA has continued the strong and stable development from 2020. The accounts show significant growth in customer funds, which increased by more than DKK 53 billion, from DKK 565 to DKK 618 billion compared to the same period last year.

The operating result for the first six months is DKK 588 million, which is an improvement compared to DKK 401 million for the same period in 2020. This development is primarily driven by an improvement of the result of the health and accident insurance from DKK -481 million to DKK -75 million during that period. Of the operating result of DKK 588 million, DKK 513 million will be transferred to PFA CustomerCapital, which is PFA’s model for sharing profit and risk with the customers.

“In the first half of the year 2021, we have continued to be affected by the COVID-19 pandemic, and during the half year we have shown that we are able to generate value for our customers during uncertain times while maintaining a solid and stable development at PFA. I am very satisfied that we could achieve an operating result of DKK 588 million,” says Group CEO at PFA, Allan Polack.

An increase in customer funds of DKK 53 billion
The regular payments, which are at DKK 13.2 billion, continue to maintain a record-high level, and the overall customer funds have increased from DKK 565 billion to DKK 618 billion, which represents an increase of more than DKK 53 billion compared to the first half of 2020. In addition, the total payments are DKK 21.3 billion, compared to DKK 20.1 billion in the same period last year, which represents growth of 6 per cent.

Allan Polack says:
“Throughout the COVID-19 pandemic, we have made an effort to be there for the customers every day, and I am happy to see that they are responding by continuing to pay more money into their pension at PFA. We have experienced strong growth in our customer funds of more than DKK 53 billion compared to last year, which is an incredibly strong result.”

Continued reduction in losses within health and accident insurance
The health and accident insurance result is DKK -75 million compared to DKK -481 million in the same period last year. This represents an improvement in the result of DKK 406 million during this period. Despite continued improvement, the result is not satisfactory.

The reduction of the negative result is driven by a positive effect of the VA (Volatility Adjustment) to the yield curve as well as the continued implementation of the ongoing restoration plan, which despite an increasing number of reported claims shows several positive developments.

“The result for the period for health and accident insurance is positively affected by the VA (Volatility Adjustment), but we also see a continued reduction of the negative result through the activities of the ongoing restoration plan, which is positive. Unfortunately, we see a clear increase in new claims, which is unfortunately an indication that more people find themselves in a challenging situation. This is not a positive development, which is why we continue to work together with our customers to prevent long-term illness and to ensure early intervention if people get sick. This establishes the best conditions for them to return to work quickly, for their own benefit as well as their workplace and PFA,” says Allan Polack.

Solid return and strong development for PFA Climate Plus
During the first half of the year, PFA achieved a total return of DKK 13.4 billion. The return at market rate is DKK 22.5 billion, which was particularly affected by the strong return on shares and unlisted investments, while the return from bonds has been challenged.

Customers with pensions in the PFA Plus plan have received up to 11.5 per cent in return, while those that have all or some of their savings in the climate-focused PFA Climate Plus have received up to 12.2 per cent in return.

“The financial markets during the first half of the year have been characterised by the strong recovery in the world economy. The first half of the year ended up generating solid two-digit per cent returns. The equity market has had strong momentum, while other asset classes such as unlisted investments have also done well,” says Allan Polack and continues:

“For just over a year now, our customers have had the opportunity to place some or all of their savings in PFA Climate Plus. Over 20,000 customers have chosen to do so, which is great. The first year of PFA Climate Plus has shown that a good return goes hand in hand with the green transition, and we are very pleased and with a return  up to 12.2 per cent.”

Facts about the accounts for the 1st half of 2021

• Operating result (Insurance result) of DKK 588 million (DKK 401 million)*
• PFA CustomerCapital’s share of the insurance result is DKK 513 million (DKK 351 million)*
• Result for the period is DKK 93 million (DKK 6 million)*
• The total payments amount to DKK 21.3 billion (DKK 20.1 billion)*
• Regular payments amount to DKK 13.2 billion (DKK 12,4 billion)*
• The result of health and accident insurance is DKK -75 million (DKK -481 million)*
• Costs per insured amount to DKK 403 (DKK 333)*
• The total investment return is DKK 13.4 billion (DKK -1.8 billion)*
• Return on market rate products before tax is between 0.4 and 12.2 per cent incl. CustomerCapital (-5.3 to 1.2 per cent)*
• Return in the average interest rate environment after value adjustment is 1.4 per cent (0.8 per cent)*
• The total customer funds amount to DKK 618 billion (DKK 565 billion)*

*figures for H1 2020
 

For additional information contact
Senior Press Officer, Rasmus Bjørn, RBJ@pfa.dk, (+45) 41729077