Great Eastern Q2 profit down to S$81.4m

The net profit for the quarter ended 30 June 2012 was lower than the S$117.7 million for the same period in 2011.

Great Eastern Holdings Limited said underwriting profit in the second quarter of 2012 achieved healthy growth over the same period last year, driven by the continued profitability of protection-based products in Singapore and investment-linked products in Malaysia. However, earnings were significantly impacted by weaker investment performance resulting from less favourable market conditions in the quarter.

In Q2-12, total weighted new sales for the Group rose 4% year-on-year to S$197.4 million. In Singapore, sales growth was supported by sustained demand for regular premium products from all channels. In Malaysia, sales performance was anchored by the continued demand for regular premium investment-linked products as well as single premium credit-related products.

Profit from insurance operations was S$75.9 million, 33% lower than the corresponding period a year ago. During the second quarter, falling interest rates, widening credit spreads and decreases in equity prices impacted both liability and asset valuations, resulting in overall mark-to-market losses. However, underwriting performance continued to be strong, offsetting these losses.