May 19, 2024

Sura 3Q 2020 Net Profits Fall 72% Year-on-Year

Medellin-based insurance and investment giant Grupo Sura announced November 13 that its third quarter (3Q) net profit fell 72% year-on-year, to COP$23.9 billion (US$6.56 million).

Nine-months 2020 net profit likewise fell 73% year-on-year, to COP$397 billion (US$109 million), according to the company.

“The insurance business continued to show resilience, even at a time when the pandemic increased its impact in Colombia, while the asset management business continued to improve the performance of the reserve requirement and the operating trends of the businesses recovered,” according to Sura.

Operating income so far this year has declined 3.3% year-on-year, to COP$15.4 trillion (US$4.22 billion), while 3Q 2020 operating income is down 2% year-on-year, according to the company.

“The growth in written premiums, income from the provision of health services and asset management fees are highlighted. On the other hand, income from investments and by the equity method decreased 28.3% and 67.5% so far this year, but a partial recovery was evident in the third quarter,” the company added.

Operating expenses grew 2.9% as of September and 4.5% in the third quarter, “driven by a normalization of the dynamics of the insurance business, a slight increase in claims, constitution of reserves and costs, and investments made to accompany clients,” according to Sura

The “Suramericana” insurance division recorded a net profit of COP$302 billion (US$83 million) in the first nine months of 2020 and COP$9.4 billion (US$2.6 million) in 3Q 2020 “in one of the most critical moments of the pandemic and facing reopening of economies,” according to Sura.

The health-care portion of Suramericana “offset the impact on claims and expenses associated with the pandemic in the ‘life’ segment,” according to the company.

The Sura Asset Management investment division “continues on a recovery trend and contributed to Grupo Sura’s consolidated results with a net profit of COP$137 billion [US$37.6 million] in the latest quarter and COP$257 billion [US$70 million] so far this year,” according to Sura.

“Positive dynamics can also be seen in the yield on legal reserve and in the income from the equity method of [pension-investment division] ‘Protection,’ which continued the recovery that began in the second quarter.

“Finally, in Grupo Sura (holding company), income from the equity method decreased 69% so far this year, but the positive contribution in the third quarter is highlighted, supported by the results of [equity holdings in] Grupo Nutresa and the partial recovery in the profit of [equity holdings in] Bancolombia,” the company added.

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