Clal concludes the third quarter with a total profit of NIS 40 million

Posted on Nov 30, 2022 by Ifi Reporter

After the two largest companies in the insurance market, Migdal and Harel, presented losses - Clal concludes the third quarter with a total profit of NIS 40 million. Last year in the corresponding period, the company presented a total profit of NIS 248 million, and it ended the last nine months with a total loss of NIS 248 million, compared to a total profit of NIS 1 billion in the corresponding period last year.
Clal explains that the loss from the beginning of the year and the decrease in profit in the third quarter are related to the declines in the markets. The company's CEO, Yoram Neve, commented on the reports: "This quarter's results highlight the importance of the MAX transaction, while diversifying the company's sources of profit and reducing dependence on the capital market. Also in this quarter, we continued to present impressive data of positive net accumulation in the pension and provident fields, which amounted to About NIS 5 billion and about NIS 14 billion in the last nine months.
"Towards the end of the third quarter, Clal carried out an institutional tender to raise Tier 2 capital, with high demands of approximately NIS 640 million, and Clal Insurance's board of directors decided to comply and raise a total of approximately NIS 500 million, out of the aforementioned amount" The return on capital in annual terms in the third quarter of the year amounted to about 2%, compared to a return on capital of about 14% in the corresponding quarter last year. The return on capital in annual terms in the first nine months of 2022 stood at a negative rate of about 4.3%, compared to a return on capital at a positive rate of about 21.3% in the corresponding period last year.
The scope of the company's managed assets amounted to approximately NIS 285 billion, compared to approximately NIS 286 billion at the end of 2021 and was affected by a significant improvement in the scope of net mobility in pension and provident benefits, alongside the negative impact of capital market returns on assets. In the period after the balance sheet date, there was an increase in the value of the managed assets to a total of approximately NIS 294 billion.
In the field of long-term savings insurance, the company concluded the quarter with a total profit of NIS 116 million - compared to a total profit of NIS 127 million in the corresponding period last year. And it ended the nine months with a total loss of NIS 183 million, compared to a total profit of NIS 694 million in the corresponding period last year. The company stated that the shift to a loss was due to the declines in the markets as well as the change in the mortality tables which required the company to set aside more for reserves.
In the field of general insurance, the company concluded the quarter with a total profit of NIS 10 million compared to a total profit of NIS 3 million last year. In the first nine months of the year, the total loss in the field amounted to NIS 130 million compared to a total profit of NIS 90 million in the corresponding period last year. The company attributes the profit in the quarter to the reduction of reserves, that is, a one-time external injection. Whereas the loss in the nine months continues the trend of insurance company losses in the general insurance sector - mainly because of the automobile industry.
In the field of health insurance, the total profit for the quarter amounted to approximately NIS 42 million compared to a total profit of NIS 109 million last year, while the company concluded the nine months with a total profit of NIS 315 million compared to a total profit of NIS 206 million in the corresponding period last year. Here, too, the increase in profit was due to the reduction of the company's security cushions for the future.


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