Active portfolio management helped French reinsurer Scor record a return on invested assets of 3.4% in the first six months of 2015, compared with 2.9% in the same period last year.
Taking account of funds withheld by cedants, the net rate of return on investments stood at 2.9% for the first half of 2015, the company said.
The reinsurer said its asset management arm, Scor Global Investments (SGI) has temporarily halted the rebalancing of its investment portfolio because of the current uncertain market environment and has increased liquidity by 4 percentage points to 9% of the invested assets portfolio, while maintaining the fixed-income portfolio duration (excluding cash) stable at 4.1 years, at 30 June 2015.
SGI highlighted the stable average rating of AA- in its fixed-income portfolio as evidence of its continuing prudent investment strategy.
SGI also continues to have no exposure to sovereign debt from the so-called GIIPS group of countries – Greece, Ireland, Italy, Portugal and Spain.
The company added that, at 30 June 2015, the expected cash flow on the fixed-income portfolio over the next 24 months stood at €5.8bn ($6.4bn) (including cash and short-term investments), "facilitating dynamic management of the reinvestment policy in view of a possible rise in interest rates".
During the first half of 2015, invested assets generated a financial contribution of €297m. The group recorded capital gains of €128m, which arose mainly from the equity portfolio and, to a lesser extent, from fixed income.
Invested assets,excluding funds withheld by cedants, stood at €17,303m. These comprised:
79% fixed income (of which 1% are short-term investments)
8% cash
5% real estate
3% loans
3% equities and
2% other investments.
Total investments, including €8,817m of funds withheld, stood at €26,120m, compared with €24,854m at 31 December 2014.
Overall, the Scor group registered a strong performance in the first half of the year, with net income of €327m up 28% over the same period of 2014.