Investments
Market development
| Net investment income Figures in EUR million | ||||||
|---|---|---|---|---|---|---|
| 2010 | +/- previous year | 2009 | 2008 | 2007 | 2006 | |
| 1 Excluding expenses on funds withheld and contract deposits | ||||||
| 2 Including depreciation/impairments on real estate | ||||||
| 3 Portfolio at fair value through profit or loss and trading | ||||||
| Ordinary investment income1 | 880.5 | +8.6% | 810.5 | 829.8 | 859.0 | 792.6 |
| Result from participations in associated companies | 3.9 | (177.6) % | (5.0) | 4.2 | 11.0 | 6.3 |
| Realised gains/losses | 162.0 | +43.4% | 113.0 | (113.6) | 174.3 | 217.4 |
| Appreciation | 27.2 | +35.5% | 20.1 | - | - | - |
| Impairments on investments2 | 23.8 | (83.3) % | 142.5 | 480.4 | 72.0 | 19.0 |
| Unrealised gains/losses3 | (39.9) | (139.7) % | 100.6 | (119.7) | (18.8) | 19.2 |
| Investment expenses | 67.4 | +26.9% | 53.1 | 41.4 | 52.0 | 49.5 |
| Net investment income from assets under own management | 942.5 | +11.7% | 843.6 | 78.9 | 901.6 | 967.0 |
| Net investment income from funds withheld | 316.4 | +14.3% | 276.8 | 199.6 | 220.1 | 221.9 |
| Total investment income | 1,258.9 | +12.4% | 1,120.4 | 278.5 | 1,121.7 | 1,188.9 |
Risk premiums on corporate bonds increased for the most part in both US and European markets as the year progressed. The resulting negative fair value effects were, however, more than offset by the yield declines during the year on US treasuries and debt securities issued by semi-governmental entities across virtually all maturity segments. Overall, this had positive implications for the development of the fair values of the fixed-income portfolio, hence also causing unrealised gains to rise in the course of the year. Both the US Federal Reserve and the European Central Bank left their key interest rates unchanged during the period under review at 0% to 0.25% and 1.00% respectively.
The return on ten-year US treasury bonds fell from 3.8% to 3.3% in the course of the year. A comparable trend was also observed for German government bonds, with the decrease from 3.4% to 3.0% in this case only marginally more moderate. The risk premiums on government bonds from a small number of European countries rose in some instances substantially during the year, leading to a patchy and volatile yield environment in Europe.
Having begun to move back into listed equities in the third quarter of the year, we have already been able to profit from the pleasing market trend in most areas since then – as reflected in an increase of EUR 30.2 million in fair values.
The euro slipped back against the US dollar and pound sterling, but lost ground particularly heavily against the Canadian and Australian dollar.