ZURICH (Reuters) - Swiss Life (S:SLHN) maintained its 2021 targets on Tuesday, saying its business model could weather the impact of the new coronavirus epidemic.
Its fee income rose 11% in local currency to 453 million Swiss francs ($465.7 million), while premiums fell by a fifth to 7.82 billion francs.
It had flagged a drop was coming after a spike a year ago when a competitor withdrew from business in Switzerland.
"The main effects of the COVID-19 pandemic for Swiss Life arise from the turmoil on the financial markets. In the 2020
financial year, this impacts fee business and also insurance business through investment income and the net investment result," it said.
Swiss Life manages the effects on its insurance business via asset liability processes, and said it has protected its interest rate margin for more than three decades, even in the current volatile environment, it said.
"Due to the balanced portfolio of mortality and longevity risks, the risks in the Swiss Life insurance book are also
manageable. Swiss Life's business model is sustainable and diversified. The company thus confirms its financial targets under the "Swiss Life 2021" group-wide programme."
Its financial objectives until 2021 feature improved earnings quality including increasing the fee result, generating operational efficiency, and maintaining capital strength.
Overall, it aims for an adjusted return on equity of 8 to 10%.
In February the company increased its dividend by more than a fifth to 20 Swiss francs a share and unveiled a share buyback worth up to 400 million Swiss francs as it reported a 12% rise in 2019 net profit.
(This story has been refiled to add missing comma in headline)