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BF&M reports 9 month earnings of $17.3 million
Hamilton, Bermuda – 14 December, 2015 — In a filing with the Bermuda Stock Exchange (“BSX”), BF&M Limited (the "Company"; Ticker: BFM.BH) today reported nine month earnings of $17.3 million. The filing stated:
BF&M Limited today reported shareholders’ net income for the nine month period ended 30th September 2015 of $17.3 million, resulting in an annualized return on shareholders’ equity of 9.5%. Shareholders’ net income for the comparative nine month period of 2014 was $21.6 million.
President & CEO John Wight stated that “financial results in the first nine months of 2015 continued to be strong. The core operating earnings in the first nine months of 2015 were in line with the corresponding period in 2014. However, the impact of the fair value adjustment to net assets resulted in a $4.6 million decline in net earnings over the prior year as the Company reported a loss for the current year of $1.4 million compared to a gain in the prior year of $3.2 million.”
The Company recently announced the acquisition of Kitson Insurance Services Ltd, a Bermuda based insurance agency and brokerage business. Mr. Wight added, “this acquisition aligned with the Group’s strategy of selectively acquiring successful insurance businesses in Bermuda and the Caribbean”.
BF&M is a well-diversified insurance and investment advisory group, with operations in Bermuda and 15 islands in the Caribbean. It has four main insurance operating companies, with the following A.M. Best financial strength ratings;
BF&M General Insurance Company Limited A (Excellent) Bermuda
BF&M Life Insurance Company Limited A (Excellent) Bermuda
Island Heritage Insurance Company Ltd. A (Excellent) Cayman
Insurance Corporation of Barbados Limited A- (Excellent) Barbados
Mr. Wight stated that “there is no domestic insurance group in Bermuda or the Caribbean with stronger ratings.”
Equity attributable to shareholders at 30th September 2015 was $252.8 million. General fund assets totaled $1.1 billion of which $111.7 million was held in cash and cash equivalents.
Gross premiums written for the nine months were $262.2 million, a decrease of 1% from 2014. Investment income for the nine months reflected a $2.3 million decrease in the value of investments for the period on poor returns in the global financial markets and increasing long term US interest rates negatively impacted the fair value of the company’s extensive fixed income portfolio. Partially offsetting this was a $0.9 million decrease in the value of policyholder benefits as a result of the company’s disciplined asset liability matching policy which limits volatility of reported earnings as a result of interest rate swings. Commission and other income increased 8% to $30.8 million from improved reinsurance commission income. Short term claims and adjustment expenses increased by 7% to $16.9 million.
Life and health policy benefits, which are recorded at fair value, decreased by 14% to $76.1 million. Operating expenses decreased by 2% to $47.6 million.