Sampo Group

Annual Report 2011
Ratings
Debt Financing

Group Solvency

With Nordea Bank AB (publ) as its associated company as of 31 December 2009 Sampo Group became a financial and insurance conglomerate according to the Act on the Supervision of Financial and Insurance Conglomerates (2004/699).

Group solvency has in 2011 been calculated according to Chapter 3 of the Act on the Supervision of Financial and Insurance Conglomerates (2004/699). The Act is based on Directive 2002/87/EC of the European Parliament and of the Council on the supplementary supervision of credit institutions, insurance undertakings and investment.

Sampo Group Solvency

EURm

31 Dec 2011

31 Dec 2010

Group capital

8,920

8,886

Sectoral items

1,091

1,711

Intangibles and other deductibles

-2,545

-2,388

Dividends for the current period

-672

-646

Group's own funds, total

6,794

7,564

     

Minimum requirements for own funds, total

4,902

4,526

     

Group solvency

1,892

3,038

     

Group solvency ratio

(Own funds % of minimum requirements)


138.6


167.1

Group solvency ratio (own funds in relation to minimum requirements for own funds) remained flat in the fourth quarter of 2011 and was 138.6 per cent (167.1) as at 31 December 2011. The decrease in the solvency ratio during 2011 was due to the change in accounting of Topdanmark holding, the reduction of the amount of Tier2 loans in Nordea and the calling of If’s hybrid loan in March 2011. The minimum capital requirement rose due to the increase in Nordea’s capital requirement. The part of Nordea’s capital requirement corresponding to Sampo’s holding in Nordea is taken into account in the Group’s capital requirement.

In Sampo Group solvency is assessed internally by comparing the capital required to the capital available. Capital requirement assessment is based on an economic capital framework, in which Group companies quantify the amount of capital required for measurable risks over a one year time horizon at 99.5 per cent´s confidence level. In addition to economic capital, companies assess their capital need related to non-measurable risks like risks in business environment. Capital available or Adjusted Solvency Capital include regulatory capital and in addition other loss absorbing items like the effect of discounting technical reserves and other reserves excluded from regulatory capital.

The economic capital tied up in Group’s operations on 31 December 2011 was EUR 4,374 million (4,281) and adjusted solvency capital was EUR 7,262 million (8,521).

Ratings
Debt Financing