Blame it on unrealised fair value losses.
Favorable financial conditions evaded the most established life insurance group in Singapore and Malaysia, as the firm’s operating profit dropped by 20% to $120.4m due to higher claims in the non-participating fund.
According to a press release by Great Eastern, the profit contribution from Malaysia in SGD terms was also lower, primarily due to a weaker Malaysian Ringgit.
The press release added that financial markets experienced widening of credit spreads and decline in equity markets in Q1, leading to a non-operating loss of $42.6m.
Meanwhile, shareholders’ Fund recorded higher investment income as well as higher realised gain from sale of investments and changes in fair value for Q1.
“However, this was more than offset by unrealised foreign exchange loss from US dollar-denominated investments. As a result, Profit from Shareholders’ Fund’s Investments for Q1-16 was lower at S$28.9 million compared with S$45.6 million for the same quarter last year,” the press release said.
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