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Management Report

Swiss Life Holding generated a profit of CHF 719 million in the 2020 financial year (previous year CHF 758 million).

The annual profit mainly consisted of dividends, investment income and revenues from guaranteed benefits and commissions. Dividend payments from subsidiaries increased from CHF 670 million in the previous year to CHF 712 million, income from guaranteed benefits and commissions fell slightly from CHF 46 million to CHF 42 million and investment income declined from CHF 72 million to CHF 52 million. The decline in investment income is due to the sale of investments to finance the CHF 1 billion share buyback programme concluded in 2019.

As at the end of the year, Swiss Life Holding had assets (liquid funds, receivables from Group companies, debt securities, equities and investment funds) of CHF 1072 million (previous year: CHF 1057 million). Cash on hand declined to CHF 28 million (previous year: CHF 51 million) and receivables from Group companies rose to CHF 165 million (previous year: CHF 68 million). Debt securities, investment funds and equities amounted to CHF 879 million at year-end (previous year: CHF 938 million).

In its 2019 financial statements, Swiss Life announced an additional share buyback programme totalling CHF 400 million. At the end of March 2020, Swiss Life, like all other major listed banks and insurance companies in Switzerland, temporarily suspended its share buyback programme having repurchased 79 324 shares worth CHF 29 million. 1 580 215 treasury shares, which had been repurchased under the share buyback programme completed in 2019, were cancelled in the year under review. The number of outstanding shares as at the end of 2020 amounted to 32 014 391, of which 0.68% are held by Swiss Life Holding.

Swiss Life Holding’s total distribution to shareholders in the period under review came to CHF 636 million, or CHF 20.00 per share, of which CHF 477 million (CHF 15.00 per share) took the form of an ordinary dividend and CHF 159 million (CHF 5.00 per share) a reduction in par value. As a result of this reduction, the par value of the share decreased to CHF 0.10 and the nominal share capital of Swiss Life Holding to CHF 3 million (previous year: CHF 171 million).

The long-term debt capital remained unchanged at CHF 1049 million. In the year under review, interest on long-term bonds totalled CHF 5 million (previous year CHF 6 million). With shortterm repo transactions, Swiss Life Holding generated interest income of CHF 1 million (previous year: CHF 2 million).

New loans totalling CHF 93 million were awarded to Group units to finance real estate projects or smaller acquisitions. Including repayments of expired loans and payments under lines of credit granted, the outstanding amount decreased slightly to CHF 1589 million (previous year: CHF 1637 million).

Interest income declined to CHF 30 million (previous year: CHF 37 million) and earnings from investments in bonds and fund units to CHF 22 million (previous year: CHF 33 million). Both loans granted internally and external investments in foreign currencies are almost fully hedged with currency futures. The cost of hedging during the reporting period was CHF 7 million (2019: CHF 24 million). The investment book value remained almost unchanged during the year under review at CHF 3221 million.

Staff costs and operating expenses remained unchanged from the previous year at CHF 16 million. Tax expenses fell to CHF 7 million (previous year: CHF 32 million).