Great Eastern’s Q3 profit up 30% on insurance business; says climate remains challenging

Great Eastern's total weighted new sales sank 27 per cent in the third quarter to $403.4 million. ST PHOTO: KUA CHEE SIONG

SINGAPORE - Great Eastern on Wednesday posted a 30 per cent increase in net profit to $278 million for the third quarter ended Sept 30, from $213.3 million a year ago.

The insurance arm of OCBC Bank said the increase was mainly driven by higher profit from its insurance business, which reflects the net mark-to-market gain on asset liability from increasing interest rates.

Non-operating profit for the segment swung to $83.9 million in the third quarter, from a loss of $3.5 million in the previous year. Year to date, non-operating profit rose 25 per cent to $311.2 million, from $248.2 million previously.

Meanwhile, operating profit for the segment declined 38 per cent year on year to $208.1 million. On a year-to-date basis, operational profit slipped marginally to $573.6 million, from $575.8 million last year.

The insurer swung to a loss from its shareholders’ fund at $103.9 million year to date – a $14.1 million loss in the third quarter – from a profit of $73.8 million previously.

This was due to lower mark-to-market losses in equities and bonds, compared with a relatively flatter performance in 2021, said Great Eastern.

Total weighted new sales sank 27 per cent in the third quarter to $403.4 million, from $554.3 million in 2021, mainly due to lower single premium sales from the Singapore market, which was offset by stronger sales momentum from the Malaysia and Indonesia markets, noted Great Eastern.

Great Eastern chief executive Khor Hock Seng expects the business climate to remain challenging in the near to medium term, “reflecting geopolitical uncertainty, a difficult investment climate and inflationary pressures”.

“Our focus remains on strengthening our business and distribution model, supported by data-driven targeted propositions to meet the needs of our customers,” he said.

Great Eastern shares were trading up 26 cents, or 1.4 per cent, to $18.30 at 11.25am on Wednesday, after the results announcement. THE BUSINESS TIMES

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