Jump to content

Elo’s investments generated over EUR 2 billion

/ News

In January–June, the return on Elo’s investments was 7.8 (-4.1) per cent, or EUR 2,007.5 million. The market value of Elo’s investments at the end of June was EUR 27.8 billion. The solvency ratio was 126.6 per cent and solvency capital was 1.6 times the solvency limit.

“Investments generated good returns in the first half of the year and Elo’s solvency improved further. The economic recovery was reflected in growth in the total payroll amount paid by customers starting from the spring,” says Elo’s CEO Hanna Hiidenpalo.

Strong returns from equity investments

The financial markets generated good returns during the first half of the year. Stimulating economic policy and improved vaccination coverage strengthened expectations of the recovery of global demand.

In Finland, economic growth was supported by the quick progress of COVID-19 vaccinations, the gradual lifting of restrictions and strengthened global demand. Growth in employment strengthened and unemployment decreased. The recovery of the service sector lagged behind the industrial sector and uncertainty regarding the economic outlook was reflected in the low level of investment, except in the construction industry. Consumption provided a strong support for demand during the review period.

Elo’s equity investments returned 15.2 (-9.7) per cent, fixed income investments 0.6 (1.2) per cent, real estate investments 2.0 (0.7) per cent and other investments 7.0 (0.8) per cent. The result of investment operations at fair values was EUR 883.0 million (EUR -1,070.1 million). During the period under review, the highest returns were generated by private equity fund investments, listed and unlisted equities.

Several industries are suffering from a shortage of production inputs and these constraints were reflected in the global economy in higher producer and raw material prices as well as the acceleration of consumer price inflation. Inflation and uncertainty regarding the duration of its acceleration were the dominant theme in financial markets during the review period.

COVID-19 variants create uncertainty regarding the growth outlook

The growth forecast for the global economy this year is 6 per cent. New COVID-19 variants create uncertainty regarding the growth outlook. Increasing vaccination coverage is a critical factor for growth and investment prospects.

The economic cycle in Europe lags slightly behind the US due to the slower rate of vaccinations in Europe and more prolonged COVID-19 restrictions. The reopening of the service sector will support economic growth during the latter part of the year. For now, it remains unclear whether the economy will see a significant and long-term increase in inflation or slow growth paired with low inflation.

In Asia, the new wave of COVID-19 has slowed down economic activity. The slowdown of investments and overall economic growth in China is likely to be reflected in a slight deterioration in the global industrial cycle during the remainder of the year.

The growth forecast for the Finnish economy this year is slightly under 3 per cent. If the COVID-19 pandemic remains under control, the recovering global economy will strengthen Finland’s exports and industry during the remainder of this year and through next year. Improving confidence will allow the release of pent-up consumer demand as well as investment demand, and domestic demand will remain strong in 2021–2022.

A significant decline in disability pensions

The application flows for old-age pensions and partial early old-age pensions have remained stable compared to the previous year. By contrast, new disability pensions at Elo declined by 13 per cent year-on-year. A total of 3,042 (3,489) new disability pension decisions were issued in the first half of the year.  The total number of disability pension decisions issued was 6,046 (6,629).

There are several reasons for the decrease in new disability pension decisions. Some of them are related to COVID-19, such as delays in getting a diagnosis when access to care has been delayed. It is hard to predict what impact the changes in people’s behaviour and health caused by the pandemic will have in the long run,” says Hiidenpalo.

Psychological disorders remain the largest diagnosis category for new disability pension decisions. Psychological and musculoskeletal disorders accounted for more than 60 per cent of new disability pension decisions. The impact of COVID-19 was also reflected in the form of a few applications for disability pension during the period under review.

A turn for the better seen in the insurance business

The COVID-19 situation improved during the review period, which was favourably reflected in the development of the TyEL payroll from March onwards. However, in the restaurant and hotel sector, which has been particularly hard hit by the pandemic, a turn for the better was only seen in May and the TyEL payroll in that sector remains lower than before the pandemic. Elo’s total TyEL payroll in the first half of the year was 4.7 per cent higher than in the corresponding period in 2020.


As Finland’s largest pension insurance provider for self-employed persons, Elo considers it important for our self-employed customers to set their YEL earned income at the right level throughout their career. We constantly communicate to our customers about the significance of YEL earned income to a self-employed person’s social security. In the first half of the year, more customers adjusted their YEL earned income higher than lower.


In June, the Financial Supervisory Authority released a bulletin aimed at all employment pension companies regarding the strengthening of YEL earned income. Employment pension companies are prepared to engage in dialogue on this topic and to develop YEL insurance. Elo takes a favourable view towards the development of the YEL system with consideration for the changing operating environment and the needs of self-employed persons.

Corporate governance


During the review period, Elo’s Board of Directors appointed B.Sc. (Econ.), EMBA Carl Pettersson as the company’s new CEO. He will take up his post on 7 October 2021.


Pekka Jaatinen, attorney, Master of Laws with court training, has served as the authorised representative appointed to Elo by the Financial Supervisory Authority since 14 December 2020. In June 2021, the Financial Supervisory Authority indicated it will reassess the need to for the authorised representative in April 2022 at the latest. During the past year, Elo has taken several measures to strengthen its governance models and expertise. These determined efforts have continued in good co-operation with the supervisory authority and the authorised representative. 


Elo Interim Report 1 January – 30 June 2021 (pdf) >

Elo Interim Report Presentation 1 January – 30 June 2021 (pdf) >


Further information:

CEO Hanna Hiidenpalo, tel. +358 20 703 5668 hanna.hiidenpalo@elo.fi

CFO Sarianne Kirvesmäki, tel. +358 20 703 5134 sarianne.kirvesmaki@elo.fi

Latest articles and news

<noscript><iframe src="https://www.googletagmanager.com/ns.html?id=GTM-P23HWQ" height="0" width="0" style="display:none;visibility:hidden"></iframe></noscript>