Kyobo Life Insurance 3Q Net Loss of 32.9 Billion Won... Cumulative Profit in the 600 Billion Won Range

Insurance Sales Performed Well but Investment Sector Losses Impacted Results

Kyobo Life Insurance recorded a net loss of around 30 billion KRW in the third quarter of this year. Although the insurance operations posted a profit, the scale of investment losses exceeded it. However, the cumulative net profit from the first to the third quarter reached around 600 billion KRW.

On the 15th, Kyobo Life Insurance announced a net loss of 32.9 billion KRW for the third quarter of this year. Compared to the net profit of 120.4 billion KRW achieved in the third quarter of last year, the profit significantly decreased, turning into a loss. The insurance sector earned a profit of 32.8 billion KRW, but the investment sector recorded a loss of 76.8 billion KRW.

The cumulative net profit for the first three quarters was 602.9 billion KRW (separate basis). Even this figure is on a downward trend, decreasing by 14.2% compared to the same period last year and by 8.1% compared to the previous quarter.

In particular, losses from fair value through profit or loss (FVPL) financial assets recognized in current earnings were significant. The valuation loss was 159.9 billion KRW, and the disposal loss was 118.9 billion KRW, totaling 278.8 billion KRW in losses in this sector.

However, the cumulative return on equity (ROE) for the third quarter was 6.98%, and the return on operating assets was 4.05%. Kyobo Life Insurance explained, "This is the highest level among major domestic life insurers, and our strategy to minimize asset sales to secure investment funds resulted in a higher asset management yield compared to other companies. During the period of rising interest rates, we focused on securing high-interest assets in alternative investments and bond assets to establish a stable source of recurring income, and we have continuously made efforts for stable asset management based on asset-liability management (ALM)."

Meanwhile, the contract service margin (CSM), a profitability indicator introduced under the new accounting standard IFRS17, showed an increasing trend. CSM is a concept that amortizes and recognizes the profit expected from insurance contracts annually, reflecting the insurer's future profits. Kyobo Life Insurance's third-quarter CSM was 6.4694 trillion KRW, an increase of about 1.2 trillion KRW compared to 5.284 trillion KRW in the first half of the year. A Kyobo Life Insurance official stated, "Despite most insurers experiencing a decrease in CSM as the Financial Supervisory Service's IFRS17 guidelines were applied for the first time, we increased it."

This content was produced with the assistance of AI translation services.