JUST GROUP PLC Annual Report and Accounts 2019
32
financial review continued
Financial investments During the year, financial investments increased by £2.4bn, from £19.3bn at 31 December 2018 to £21.6bn at 31 December 2019. The increase is mainly a result of investing the Group’s new business premiums. The credit quality of the corporate bond portfolio remains high, with 58% of the Group’s corporate bond and gilts portfolio rated A or above (2018: 60%) and continues to be well balanced across a range of industry sectors. At 31 December 2019 the Group’s holding in liquidity funds was higher than in prior periods (2019: £1,384.0m, 2018: £882.5m), awaiting investment into corporate bonds and other fixed income assets. During the year the Group continued to increase its investment in private assets, including infrastructure loans and commodity trade finance. The loan-to-value ratio of the mortgage portfolio at 31 December 2019 was 34.3% (2018: 32.5%), and the percentage of lifetime mortgages reduced marginally to 36.9% of financial investments. The following table provides a breakdown by credit rating of financial investments.
HIGHLIGHTS FROM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION The following table presents selected items from the Condensed consolidated statement of financial position, with key line item explanations below. Condensed consolidated statement of financial position
31 December 2019 £m
31 December 2018 £m
Assets Financial investments Reinsurance assets
21,606.0 3,732.0
19,252.5 4,239.2
555.8
Other assets Total assets
454.1
25,893.8
23,945.8
198.0 949.9 879.9
Share capital and share premium
188.6 885.5 590.3
Other reserves
31 December 2019 %
31 December 2019 £m
31 December 2018 %
31 December 2018 £m
Accumulated profit and other adjustments Total equity attributable to ordinary shareholders of Just Group plc
2,319.3 1,500.4 3,345.0 4,791.1
10.7
AAA1
1,798.9 1,799.8 3,151.1 4,072.0 1,031.0 7,191.5 19,252.5 208.2
9.3 9.3
2,027.8
1,664.4
7.0
AA1 and gilts
294.0
Tier 1 notes
–
15.5 22.2
A
16.4 21.1
(0.8)
Non-controlling interest
(0.6)
BBB
Total equity
2,321.0
1,663.8
156.3
0.7 7.0
BB or below
1.1 5.4
Liabilities Insurance liabilities
1,513.4 7,980.5
Other2
19,003.7 3,678.9
17,273.8 4,063.3
36.9
Lifetime mortgages
37.4
Other financial liabilities
Total
21,606.0 100.0
100.0
72.6
Insurance and other payables
78.3
1 Includes units held in liquidity funds. 2 Includes private rated bonds, internally rated assets and own-rated assets. Economic, Social and Governance and investing Just Group is a signatory to the United Nations Principles for Responsible Investment (“PRI”). We were the first UK insurer to do this. In making investment decisions, sustainable investing principles are formally embedded within our processes, as set out in our Sustainable Investment Framework approved by the Board. We are delighted our efforts have been recognised by satisfying the requirements to become a constituent of the FTSE4Good Index Series. The index is designed to measure the performance of companies demonstrating strong ESG practices. Reinsurance assets Reinsurance assets decreased from £4.2bn at 31 December 2018 to £3.7bn at 31 December 2019. The decrease relates to the impact of reinsurance recaptures made during the year (see Reinsurance recapture section above), and to the receipt of reinsurers’ share of claims paid during the year. Since the introduction of Solvency II in 2016, the Group has increased its use of reinsurance swaps rather than quota share treaties. Other assets Other assets mainly comprise cash and cash equivalents, and intangible assets.
817.6
Other liabilities Total liabilities
866.6
23,572.8 25,893.8
22,282.0 23,945.8
Total equity and liabilities
We believe in sustainable investment. Just Group was the first UK insurer to become a signatory to the United Nations Principles for Responsible Investment
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