Markets trouble Desjardins, despite group insurance growth

Despite a rough showing overall for Montreal’s Desjardins-Laurentian Financial Corporation, the company’s p&c unit performed well in the second quarter of 2002.
Net premiums for life/health and general insurance were up 9% for the quarter ending June 30, 2002, to $660.1 million from $603.7 million for the same period last year. The company reports growth across all business lines for its group general insurance business, as well as in its group life/health business.
For the company as a whole, net earnings were $28.6 million, with ROE at 10.1%, compared to $44.3 million (ROE: 17.7%) for second-quarter 2001. This is partly due to more than $30 million in provisions taken in the first half of 2002 to account for the poor performance of financial markets.
Consolidated revenues were down only slightly for the quarter, to $876.4 million from $882.5 million but operating expenses were also up, to $264.6 million from $250.7 million. This increase, the company reports was largely due to “development expenses” including the hiring of financial securities advisers and development in its securities brokerage sector.
As of June 30, the company’s consolidated assets totaled $13.7 billion versus $12.8 billion at the end of last year, an increase attributed to increased bond desk activity in the securities operation.
A dividend of $0.375 per Class A Preferred share has been declared by the company’s board.