New Ireland reports sharp declines for 2009
Published 20/07/2010 | 05:00
New Ireland Assurance -- due to be sold by Bank of Ireland -- has reported a 66pc drop in profits as fee income and property write-downs took a toll on its 2009 results.
Pre-tax profit crashed from €99.4 to €33.6m, and the company halted a dividend that in recent years often reached €149m. The premiums written by the company dropped to €898m from €1.3bn.
The company's total net assets rose, however, from €11.5bn to €12.8bn as the stock market staged a recovery.
Pay and commissions for staff fell sharply, with staff costs down to €36.4m, from €41.3m, and commissions sliding to €61.7m, from €89m.
While premiums were down, the company managed to lower its expenses by 10pc overall, due to lower expenses when winning new business. Claims paid fell by 30pc to €800m as "fewer customers chose to surrender their policies".
The company has stakes in a range of property companies, many of them registered in Luxembourg and the Netherlands.
The company also controls 17pc of the equity in the special purpose vehicle behind NAMA. This special purpose vehicle is known as National Asset Management Agency Investment Ltd (NAMAIL).
Meanwhile, the life and pensions arm of Bank of Ireland -- which includes New Ireland Assurance -- has reported a major plunge in profitability as consumers cut back on financial spending.
Dividends paid to Bank of Ireland Life Holdings by its various subsidiaries dropped to €32m from €170m in the previous year. Among the largest companies in Bank of Ireland Life Holdings is New Ireland Assurance, which is due to be sold off within the next three to four years, following an order from the EU Commission.