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Financial statement
presentation 2023
16 February 2024
The figures have not been audited.
Veritas’ strong growth continued
• Veritas’ sales achieved a new record last year both in terms of policy
figures and premium income.
• During the year, Veritas gained more than 5,100 new TyEL and YEL
insurance policies to manage. The new premiums written totalled EUR
108.2 million.
• Veritas’ premiums written increased by 4 per cent over the previous year
and was EUR 724 million.
• The TyEL payroll of companies insured by Veritas grew by 4.4 per cent.
• At the end of year, nearly 66,000 employees and 15,000 self-employed
persons were insured by Veritas. The number of pensioners was 39 000.
2
The return on Veritas’ investments was 5.7 per cent
• The return on fixed-income investments was 7.8 per cent, equity investments 8.7
per cent, real estate investments -4.1 per cent and other investments 4.8 per cent.
• The value of Veritas’ investments was EUR 4.4 billion at the end of 2023.
• Veritas’ solvency remained at a secure level and was 1.6 times the solvency limit at
the end of the year.
4.4bn
Value of investments
1.6
Solvency position
122.2%
Solvency ratio
5.7%
Return on investments
3
Investments
Investments returned 5.7 per cent
Investment returns
6.5 %
5.8 %
6.6 %
8.0 %
-1.5 %
9.9 %
5.6 %
12.6 %
-4.5 %
5.7 %
-6.0 %
-4.0 %
-2.0 %
0.0 %
2.0 %
4.0 %
6.0 %
8.0 %
10.0 %
12.0 %
14.0 %
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
• The return on Veritas’
investments was 5.7 per cent
in 2023.
• In the fourth quarter, the return
on investments was
3.3 per cent.
• The return on fixed income
investments was 7.8 per cent,
equity investments
8.7 per cent, real estate
investments -4.1 per cent and
other investments 4.8 per cent.
5
2023 –the year of interest rate hikes and inflation
0%
1%
2%
3%
4%
5%
6%
01/2023 02/2023 03/2023 04/2023 05/2023 06/2023 07/2023 08/2023 09/2023 10/2023 11/2023 12/2023
Return development of Veritas’ investments
Reopening of China
increased growth
expectations
Silicon Valley
bank collapse
AI buzz in tech
companies
Last Fed
interest rate
hike
Last ECB
interest rate
hike
Peak of
market
interest rates
Accelerated
reversal of
inflation
6
The cumulative investment return for a 10-year
period is 68.4 per cent
90
100
110
120
130
140
150
160
170
180
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
The return is calculated from 1 January 2014 to 31 December 2023.
Nominal return
10 years
5,3 %
5 years
5,7 %
Real return
10 years
3,3 %
5 years
2,2 %
7
The share of equity investments was increased
during the year
29.9 %
39.5 %
15.7 %
13.3 %
1.6 %
33.7 %
44.7 %
14.7 %
13.3 %
-6.4 %
30.9 %
45.7 %
14.9 %
13.5 %
-5.0 %
28.2 %
46.9 %
14.2 % 13.7 %
-2.9 %
-10.0 %
0.0 %
10.0 %
20.0 %
30.0 %
40.0 %
50.0 %
Fixed-income investments Equities and shares Real-estate investments Other investments Effect of derivates
31.3.2023 30.6.2023 30.9.2023 31.12.2023
8
Geographical distribution of investments
All investments Listed equities
9
Breakdown of investments at fair value
¹ Includes accrued interest
² Includes cash and bank balance as well as
settlement receivables and liabilities
³ Includes private equity and mezzanine funds
⁴ Includes unlisted real estate investment
companies
⁵ Includes all types of hedge fund shares,
regardless of the fund’s strategy
⁶ Includes items that cannot be allocated to other
investment groups
⁷ Includes the effect of derivatives on the
difference between risk-adjusted breakdown and
basic breakdown. The effect may be positive or
negative (+/-). When the effect is taken into
account, the sums of the risk-adjusted
breakdown and the basic breakdown are equal.
⁸ The relative proportion is calculated using the
total of the line ‘Total investments at fair value’ as
the divisor.
The table has been compiled according to the
guidelines of the Finnish Pension Alliance Tela.
10
2023
EUR million % EUR million % ⁸ %
1 265,1 28,7 1 245,8 28,2 7,8
Loan receivables ¹ 61,1 1,4 61,1 1,4 5,6
Bonds ¹ 1 085,1 24,6 1 065,8 24,2 8,7
Government bonds 609,5 13,8 590,3 13,4 6,8
Other bonds 475,5 10,8 475,5 10,8 11,6
Other money market instruments and deposits ¹ ² 118,9 2,7 118,9 2,7 2,0
Equity investments 1 918,8 43,5 2 067,9 46,9 8,7
Listed equities 1 447,0 32,8 1 596,1 36,2 9,2
Private equity investments ³ 402,9 9,1 402,9 9,1 6,2
Unlisted equities ⁴ 68,9 1,6 68,9 1,6 14,2
Real estate investments 624,3 14,2 624,3 14,2 -4,1
Direct real estate investments 503,4 11,4 503,4 11,4 -4,7
Real estate funds 121,0 2,7 121,0 2,7 -1,2
Other investments 602,5 13,7 602,5 13,7 4,8
Hedge fund investments ⁵ 478,0 10,8 478,0 10,8 3,0
Other investments ⁶ 124,5 2,8 124,5 2,8 11,5
Total investments 4 410,7 100,0 4 540,6 102,9 5,7
Effect of derivatives ⁷ -129,8 -2,9
Total investments at fair value 4 410,7 100,0
Modified duration of the bond portfolio 4,2
Open currency position, % of the market value of investments 23,9
Fixed-income investments
Basic breakdown Risk-adjusted breakdown Return
31 Dec 2023 31 Dec 2023
Veritas’ solvency stands at a secure level
100%
105%
110%
115%
120%
125%
130%
135%
140%
0
200
400
600
800
1 000
1 200
Solvency limit, EUR million Solvency capital, EUR million
Solvency ratio, % (right-hand scale)
• The solvency ratio was
122.2 per cent at the end of
the year 2023.
• The solvency position was
1.6 times the solvency limit.
• The solvency capital stood
at EUR 826.3 million at the
end of the year.
1) Veritas Pension Insurance and Pensions-Alandia merged on 1 January 2019. The figures for the previous years are Veritas figures before the merger.
11
Pensions and insurance
Current pension issues
• The earnings-related pension index increased pensions in payment by
about 5.7 per cent as of 1 January 2024.
• The wage coefficient increased pensions that are accrued but not yet in
payment by approximately 5.1 per cent.
• Veritas’ online pension record was upgraded in October 2023. The
upgrade improved the functionality and accessibility of the pension
record.
• The pension record provides an estimate of the pension amount at the
minimum retirement age, the target retirement age and the maximum
retirement age.
13
The reformed contribution category model
promotes longer work careers
• Changes to the contribution category model for disability pension funding
entered into force at the start of 2024.
• The employer’s liability is reduced so that even fully liable employers must pay
part of the tariff contribution.
• Cash rehabilitation benefits that have lasted for over two years will now affect
the contribution category.
• Pension cases that are more than five years old no longer affect the contribution
category.
• The disability of people over 55 years of age who are genuinely recruited as new
employees no longer affects the contribution category.
• Employment disability cases that start with work trials or apprenticeship training
as a part of vocational rehabilitation do not affect the contribution category if the
period between the start of the rehabilitation to the pension event is a maximum
of five years (as organised by a pension company, Kela or a motor liability or
accident insurance company).
14
Veritas pays out more than EUR 700 million
in pensions
Pensions and other claims paid, EUR million
589.5 585.4
601.9
635.2
701.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
2019 2020 2021 2022 2023
Number of pensioners
37118
37627 37965
38785
39396
20000
25000
30000
35000
40000
45000
2019 2020 2021 2022 2023
15
Veritas manages the earnings-related pension
security of more than 120,000 people
Number of insured persons
65 983
67 728
64 319
58 940
62 263
14 864
14 391
13 859
13 285
12 940
39 396
38 785
37 965
37 627
37 118
0 20000 40000 60000 80000 100000 120000 140000
2023
2022
2021
2020
2019
TyEL insured YEL insured Pension recipients
TyEL insured
YEL insured
Pension recipients
65 983
14 864
39 396
16
Premiums written grew by 4.0 per cent
Premiums written, EUR million
592.7
551.6
614.3
696.5
724.1
300.0
350.0
400.0
450.0
500.0
550.0
600.0
650.0
700.0
750.0
2019 2020 2021 2022 2023
• Veritas’ premiums written totalled
EUR 724.1 million.
• The share of TyEL insurances
accounted for EUR 645.3 million and
YEL insurances for EUR 78.7 million.
• Premiums written increased by
4.0 per cent in comparison to 2022.
17
TyEL payroll grew by 4.4 per cent
TyEL payroll, EUR million
2159.2 2131.4
2244.6
2488.2
2598.9
1000.0
1200.0
1400.0
1600.0
1800.0
2000.0
2200.0
2400.0
2600.0
2800.0
2019 2020 2021 2022 2023
Number of TyEL policies
8885
9385 9339 9377
9213
5000
5500
6000
6500
7000
7500
8000
8500
9000
9500
10000
2019 2020 2021 2022 2023
18
Strong growth in YEL insurance policies continues
Reported income under YEL, EUR million
289.6 295.6 302.5
319.6
336.6
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
2019 2020 2021 2022 2023
Number of YEL policies
12940
13285
13859
14391
14864
5000
7000
9000
11000
13000
15000
17000
2019 2020 2021 2022 2023
19
Client bonuses at same level as in 2022
Transfer to client bonuses 1), EUR million
10.8
3.6
12.9
8.3 8.4
7.1
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
2019 2020 2021 2022 2023
Transfer to client bonuses Transfer on a normal year
Transfer to client bonuses 1),
% of TyEL payroll
0.50
0.17
0.57
0.33 0.32
0.33
0.00
0.10
0.20
0.30
0.40
0.50
0.60
2019 2020 2021 2022 2023
Transfer to client bonuses Transfer on a normal year
1) A temporary legislative amendment was made due to the corona pandemic and the TyEL contribution was reduced by 2.6% for the period 1 May–31 December 2020. The
law provided that the pension insurance companies were no allowed to pay client bonuses during the reduction period. Thus, the client bonuses for 2020 could be at most
one third of the normal amount of client bonuses. If no amendment had been made, the client bonuses for 2020 would have been EUR 10.7 million or 0.50% of the TyEL
payroll.
20
Result
21
1) Veritas changed the accounting principles regarding development expenditure of IT systems in 2022. This resulted in a non-recurring impairment of EUR 6.8 million in
capitalized IT systems expenditure.
Result analysis, EUR million 2023 2022
Technical underwriting result -2.8 11.0
Return on investments at fair value 26.1 -263.9
+ Net return on investments at fair value 237.6 -198.7
- Return requirement on technical provisions -211.5 -65.3
Loading profit 1) -0.3 -7.4
Other profit 0.3 0.9
Total result 23.2 -259.5
Operating income covered by expense loading component, EUR million 1) 18.0 26.8
Number of employees (average) 130 146
#WeAreVeritas

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Veritas Financial statement presentation 2023

  • 1. Financial statement presentation 2023 16 February 2024 The figures have not been audited.
  • 2. Veritas’ strong growth continued • Veritas’ sales achieved a new record last year both in terms of policy figures and premium income. • During the year, Veritas gained more than 5,100 new TyEL and YEL insurance policies to manage. The new premiums written totalled EUR 108.2 million. • Veritas’ premiums written increased by 4 per cent over the previous year and was EUR 724 million. • The TyEL payroll of companies insured by Veritas grew by 4.4 per cent. • At the end of year, nearly 66,000 employees and 15,000 self-employed persons were insured by Veritas. The number of pensioners was 39 000. 2
  • 3. The return on Veritas’ investments was 5.7 per cent • The return on fixed-income investments was 7.8 per cent, equity investments 8.7 per cent, real estate investments -4.1 per cent and other investments 4.8 per cent. • The value of Veritas’ investments was EUR 4.4 billion at the end of 2023. • Veritas’ solvency remained at a secure level and was 1.6 times the solvency limit at the end of the year. 4.4bn Value of investments 1.6 Solvency position 122.2% Solvency ratio 5.7% Return on investments 3
  • 5. Investments returned 5.7 per cent Investment returns 6.5 % 5.8 % 6.6 % 8.0 % -1.5 % 9.9 % 5.6 % 12.6 % -4.5 % 5.7 % -6.0 % -4.0 % -2.0 % 0.0 % 2.0 % 4.0 % 6.0 % 8.0 % 10.0 % 12.0 % 14.0 % 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 • The return on Veritas’ investments was 5.7 per cent in 2023. • In the fourth quarter, the return on investments was 3.3 per cent. • The return on fixed income investments was 7.8 per cent, equity investments 8.7 per cent, real estate investments -4.1 per cent and other investments 4.8 per cent. 5
  • 6. 2023 –the year of interest rate hikes and inflation 0% 1% 2% 3% 4% 5% 6% 01/2023 02/2023 03/2023 04/2023 05/2023 06/2023 07/2023 08/2023 09/2023 10/2023 11/2023 12/2023 Return development of Veritas’ investments Reopening of China increased growth expectations Silicon Valley bank collapse AI buzz in tech companies Last Fed interest rate hike Last ECB interest rate hike Peak of market interest rates Accelerated reversal of inflation 6
  • 7. The cumulative investment return for a 10-year period is 68.4 per cent 90 100 110 120 130 140 150 160 170 180 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 The return is calculated from 1 January 2014 to 31 December 2023. Nominal return 10 years 5,3 % 5 years 5,7 % Real return 10 years 3,3 % 5 years 2,2 % 7
  • 8. The share of equity investments was increased during the year 29.9 % 39.5 % 15.7 % 13.3 % 1.6 % 33.7 % 44.7 % 14.7 % 13.3 % -6.4 % 30.9 % 45.7 % 14.9 % 13.5 % -5.0 % 28.2 % 46.9 % 14.2 % 13.7 % -2.9 % -10.0 % 0.0 % 10.0 % 20.0 % 30.0 % 40.0 % 50.0 % Fixed-income investments Equities and shares Real-estate investments Other investments Effect of derivates 31.3.2023 30.6.2023 30.9.2023 31.12.2023 8
  • 9. Geographical distribution of investments All investments Listed equities 9
  • 10. Breakdown of investments at fair value ¹ Includes accrued interest ² Includes cash and bank balance as well as settlement receivables and liabilities ³ Includes private equity and mezzanine funds ⁴ Includes unlisted real estate investment companies ⁵ Includes all types of hedge fund shares, regardless of the fund’s strategy ⁶ Includes items that cannot be allocated to other investment groups ⁷ Includes the effect of derivatives on the difference between risk-adjusted breakdown and basic breakdown. The effect may be positive or negative (+/-). When the effect is taken into account, the sums of the risk-adjusted breakdown and the basic breakdown are equal. ⁸ The relative proportion is calculated using the total of the line ‘Total investments at fair value’ as the divisor. The table has been compiled according to the guidelines of the Finnish Pension Alliance Tela. 10 2023 EUR million % EUR million % ⁸ % 1 265,1 28,7 1 245,8 28,2 7,8 Loan receivables ¹ 61,1 1,4 61,1 1,4 5,6 Bonds ¹ 1 085,1 24,6 1 065,8 24,2 8,7 Government bonds 609,5 13,8 590,3 13,4 6,8 Other bonds 475,5 10,8 475,5 10,8 11,6 Other money market instruments and deposits ¹ ² 118,9 2,7 118,9 2,7 2,0 Equity investments 1 918,8 43,5 2 067,9 46,9 8,7 Listed equities 1 447,0 32,8 1 596,1 36,2 9,2 Private equity investments ³ 402,9 9,1 402,9 9,1 6,2 Unlisted equities ⁴ 68,9 1,6 68,9 1,6 14,2 Real estate investments 624,3 14,2 624,3 14,2 -4,1 Direct real estate investments 503,4 11,4 503,4 11,4 -4,7 Real estate funds 121,0 2,7 121,0 2,7 -1,2 Other investments 602,5 13,7 602,5 13,7 4,8 Hedge fund investments ⁵ 478,0 10,8 478,0 10,8 3,0 Other investments ⁶ 124,5 2,8 124,5 2,8 11,5 Total investments 4 410,7 100,0 4 540,6 102,9 5,7 Effect of derivatives ⁷ -129,8 -2,9 Total investments at fair value 4 410,7 100,0 Modified duration of the bond portfolio 4,2 Open currency position, % of the market value of investments 23,9 Fixed-income investments Basic breakdown Risk-adjusted breakdown Return 31 Dec 2023 31 Dec 2023
  • 11. Veritas’ solvency stands at a secure level 100% 105% 110% 115% 120% 125% 130% 135% 140% 0 200 400 600 800 1 000 1 200 Solvency limit, EUR million Solvency capital, EUR million Solvency ratio, % (right-hand scale) • The solvency ratio was 122.2 per cent at the end of the year 2023. • The solvency position was 1.6 times the solvency limit. • The solvency capital stood at EUR 826.3 million at the end of the year. 1) Veritas Pension Insurance and Pensions-Alandia merged on 1 January 2019. The figures for the previous years are Veritas figures before the merger. 11
  • 13. Current pension issues • The earnings-related pension index increased pensions in payment by about 5.7 per cent as of 1 January 2024. • The wage coefficient increased pensions that are accrued but not yet in payment by approximately 5.1 per cent. • Veritas’ online pension record was upgraded in October 2023. The upgrade improved the functionality and accessibility of the pension record. • The pension record provides an estimate of the pension amount at the minimum retirement age, the target retirement age and the maximum retirement age. 13
  • 14. The reformed contribution category model promotes longer work careers • Changes to the contribution category model for disability pension funding entered into force at the start of 2024. • The employer’s liability is reduced so that even fully liable employers must pay part of the tariff contribution. • Cash rehabilitation benefits that have lasted for over two years will now affect the contribution category. • Pension cases that are more than five years old no longer affect the contribution category. • The disability of people over 55 years of age who are genuinely recruited as new employees no longer affects the contribution category. • Employment disability cases that start with work trials or apprenticeship training as a part of vocational rehabilitation do not affect the contribution category if the period between the start of the rehabilitation to the pension event is a maximum of five years (as organised by a pension company, Kela or a motor liability or accident insurance company). 14
  • 15. Veritas pays out more than EUR 700 million in pensions Pensions and other claims paid, EUR million 589.5 585.4 601.9 635.2 701.0 200.0 300.0 400.0 500.0 600.0 700.0 800.0 2019 2020 2021 2022 2023 Number of pensioners 37118 37627 37965 38785 39396 20000 25000 30000 35000 40000 45000 2019 2020 2021 2022 2023 15
  • 16. Veritas manages the earnings-related pension security of more than 120,000 people Number of insured persons 65 983 67 728 64 319 58 940 62 263 14 864 14 391 13 859 13 285 12 940 39 396 38 785 37 965 37 627 37 118 0 20000 40000 60000 80000 100000 120000 140000 2023 2022 2021 2020 2019 TyEL insured YEL insured Pension recipients TyEL insured YEL insured Pension recipients 65 983 14 864 39 396 16
  • 17. Premiums written grew by 4.0 per cent Premiums written, EUR million 592.7 551.6 614.3 696.5 724.1 300.0 350.0 400.0 450.0 500.0 550.0 600.0 650.0 700.0 750.0 2019 2020 2021 2022 2023 • Veritas’ premiums written totalled EUR 724.1 million. • The share of TyEL insurances accounted for EUR 645.3 million and YEL insurances for EUR 78.7 million. • Premiums written increased by 4.0 per cent in comparison to 2022. 17
  • 18. TyEL payroll grew by 4.4 per cent TyEL payroll, EUR million 2159.2 2131.4 2244.6 2488.2 2598.9 1000.0 1200.0 1400.0 1600.0 1800.0 2000.0 2200.0 2400.0 2600.0 2800.0 2019 2020 2021 2022 2023 Number of TyEL policies 8885 9385 9339 9377 9213 5000 5500 6000 6500 7000 7500 8000 8500 9000 9500 10000 2019 2020 2021 2022 2023 18
  • 19. Strong growth in YEL insurance policies continues Reported income under YEL, EUR million 289.6 295.6 302.5 319.6 336.6 0.0 50.0 100.0 150.0 200.0 250.0 300.0 350.0 2019 2020 2021 2022 2023 Number of YEL policies 12940 13285 13859 14391 14864 5000 7000 9000 11000 13000 15000 17000 2019 2020 2021 2022 2023 19
  • 20. Client bonuses at same level as in 2022 Transfer to client bonuses 1), EUR million 10.8 3.6 12.9 8.3 8.4 7.1 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 2019 2020 2021 2022 2023 Transfer to client bonuses Transfer on a normal year Transfer to client bonuses 1), % of TyEL payroll 0.50 0.17 0.57 0.33 0.32 0.33 0.00 0.10 0.20 0.30 0.40 0.50 0.60 2019 2020 2021 2022 2023 Transfer to client bonuses Transfer on a normal year 1) A temporary legislative amendment was made due to the corona pandemic and the TyEL contribution was reduced by 2.6% for the period 1 May–31 December 2020. The law provided that the pension insurance companies were no allowed to pay client bonuses during the reduction period. Thus, the client bonuses for 2020 could be at most one third of the normal amount of client bonuses. If no amendment had been made, the client bonuses for 2020 would have been EUR 10.7 million or 0.50% of the TyEL payroll. 20
  • 21. Result 21 1) Veritas changed the accounting principles regarding development expenditure of IT systems in 2022. This resulted in a non-recurring impairment of EUR 6.8 million in capitalized IT systems expenditure. Result analysis, EUR million 2023 2022 Technical underwriting result -2.8 11.0 Return on investments at fair value 26.1 -263.9 + Net return on investments at fair value 237.6 -198.7 - Return requirement on technical provisions -211.5 -65.3 Loading profit 1) -0.3 -7.4 Other profit 0.3 0.9 Total result 23.2 -259.5 Operating income covered by expense loading component, EUR million 1) 18.0 26.8 Number of employees (average) 130 146