Despite low interest rates and economic uncertainty, Standard Life Financial today reported net income of $244 million in 2011, slightly down from $252 million 2010.
A company release said higher fee income from investment products and enhanced investment yields, including gains from a robust property market, were the main drivers of profits in 2011.
“Standard Life has continued to grow its core business in 2011, despite the challenging economic conditions, particularly in the fourth quarter,” said Charles Guay, president, Standard Life. “We are poised to take advantage of market opportunities and confident that the growth prospects in our key markets will lead to sustained operating performance.”
Pooled Registered Pension Plans (PRPPs) will open new routes to market for pension providers, he said. The company also expects to benefit from the ongoing shift from DB plans to DC pension plans.
Premiums and deposits increased 8% to $1.4 billion in the fourth quarter, up from $1.3 billion in 2010, and grew 7% to $5.3 billion for the full year, up from $5 billion in 2010.
That growth was driven by strong performance in group savings and retirement and group benefit and disability management businesses as its assets under administration grew 5% to $41 billion at the end of 2011 compared to $39 billion a year ago.
Group savings and retirement business premiums and deposits saw a 10% increase to $2.9 billion, while its core business segment of defined contribution plans with premiums and deposits up 11% to $2.2 billion.
The company’s group benefit and disability management business grew 6% to $700 million in premiums. Overall, the group benefit business continued to perform well with strong growth in market share benefiting from large mandates. Disability management, the core segment in this business, continues to drive growth with a 10% increase in premiums.
The strong Canadian results—including a 28% increase in operating profit—have caught the attention of the press in the U.K., where Standard Life’s global operations are based.