SLUGGISH ECONOMY
Sanlam hit by poor investment returns
Sanlam became the latest South African insurer to be hit by the sluggish economy and poor market returns, joining Discovery and Liberty in posting a decline in 2018 net profit. Investment returns plummeted 57% to R707m compared to R1.66bn in the previous year, the company said on Thursday. That was largely behind an 8% decline in earnings to R9bn. Investment returns are important for insurers, who invest the capital that they need to hold for solvency reasons, and poor returns can offset profits elsewhere in the business. "It’s a tough environment in SA. Good businesses are producing mediocre results," Sanlam CEO Ian Kirk said on Thursday. "We would have liked to have been in a better position, of course. But given the conditions, I think these are very credible."
A report this week showed the SA economy grew 0.8% in 2018 which, although it was slightly higher than what the Treasury and the Reserve Bank predicted, was just more than half the rate of the previous year, when Jac...
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