Life insurers see H1 earnings dip 45.7 pct amid turmoil

SEOUL, Nov. 17 (Yonhap) -- The total earnings of life insurers operating in South
Korea tumbled 45.7 percent on-year in the first half of fiscal 2008, dented by
recent financial turmoil, the financial watchdog said Monday.

The combined net profit of 22 local and foreign-based life insurers in the
country came to 747.4 billion won (US$533.5 million) in the April-September
period, compared with 1.38 trillion won a year earlier, the Financial Supervisory
Service (FSS) said.
"The fall was mainly attributed to the recent volatility of the financial market
leading to adverse asset management conditions," the FSS said in a statement.
Due to the weaker bottom line, the return on assets (ROA) by life insurers, a
measure of profitability, declined to 0.5 percent in the first half, compared
with 1 percent a year ago.
Meanwhile, 27 non-life insurers posted a combined net profit of 1.11 trillion won
in the first half that ended on Sept. 30, down from 1.03 trillion won the
previous year, the FSS said.
Their ROA, however, came in at 3 percent in the April-September period, down 0.4
percentage point from a year earlier, it added.
The non-performing loan ratio of insurers operating in South Korea reached 1.8
percent as of the end of September, down 0.2 percentage point from the end of
March.
Bad loans or loans classified as substandard and below are debts that are overdue
for over three months. The non-performing loan ratio refers to the ratio of bad
loans to aggregate lending.
The default rate for local insurers' loans came in at 3.6 percent as of
end-September, down 0.1 percentage point six months ago, it added.
sooyeon@yna.co.kr
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