RUSSIA: for 9M2021, the profit of the insurance sector decreased by almost 18% y-o-y

8 December 2021 —
The profit of Russian insurers in 9M2021 decreased by 17.7% to RUB 189.7 billion (~EUR 2.25 billion*) due to the negative currency revaluation of assets.

As a result, profitability of insurance companies decreased, although it remained at a high level (ROE - 22.8%, ROA - 5.2%), ASN reports with reference to the Review of key indicators of insurers, published by the Bank of Russia.

The five largest insurers accounted for about half of the profits earned over the period. The decrease in profit was due to a decrease in the result from investment activities caused by a decrease in "income minus expenses from foreign exchange transactions" due to a negative revaluation of foreign currency assets at the end of three quarters of 2021 and high income in this category in the same period of 2020 against the background of weakening ruble, as noted by the regulator. At the same time, income from all other investment activities increased. The result from insurance operations has also increased.

"The structure of insurers' assets remains stable. Corporate and government bonds (27% and 21% at the end of September 2021, respectively) are still the key investment targets. Total value of insurers' assets at the end of the third quarter of 2021 amounted to RUB 4.2 trillion (+8.6% y-o-y). The capital of insurers is RUB 945 billion (+4.1%)", the Review said.

* at the following exchange rate:

1 EUR = 84.3050 RUB (01.10.2021)