September 25, 2023

Proteccion Full-Year 2022 Net Income Rises 5.5% Year-On-Year

Medellin-based pension fund, insurance and disability-benefits manager Proteccion announced April 3 a 5.5% year-on-year boost in net income for 2022, hitting COP$291.8 billion (US$63.4 million).

Gross revenues also rose 1.5% year-on-year, to COP$1 trillion (US$217 million), according to the company.

Aiding those gains was the 6.27% rise in the number of contributing affiliates (now almost 8 million) to its various pension funds, with Proteccion now administering funds totaling some COP$150 trillion (US$32.6 billion), according to the company.

“One of the main variables that favored this result was the 2.6% decrease in the national unemployment rate in 2022, which as of December 31, 2022, stood at 10.3%. This increased the number of contributors, which, in turn, represents 57% of the pension-fund administrator income,” the company explained.

Net equity dipped 7.9% year-on-year, to slightly more than COP$2 trillion (US$435 million) –mainly because of a COP$300 billion (US$65 million) capitalization move for the creation of its new “Asulado Seguros de Vida S.A.” spin-off, which offers annuities, pension insurance and disability coverage.

Meanwhile, total liabilities plummeted 64% year-on-year, to COP$494 billion (US$107 million). That benefit came as “the result of the reversal of provisions for insufficient premiums” initially mandated by government regulations in 2018, but since terminated.

Uncertainly lies ahead for Proteccion — and other Colombian pension-fund administrators — as recently elected President Gustavo Petro has proposed radical changes that could suffocate existing private funds by diverting nearly all contributions to the state-run Colpensiones pension fund.

However, that proposal has already drawn harsh criticism from a wide variety of political parties in the Colombian Congress — so the Petro proposal may be drastically altered in future congressional debates.

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