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Elo’s investments increased pension assets by EUR 2.4 billion

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In January–September, the return on Elo’s investments was 9.4 per cent, or EUR 2.4 billion. The market value of the investments was EUR 28.3 billion at the end of September. The solvency ratio was 126.9 per cent and solvency capital was 1.6 times the solvency limit.

“The economic environment has been characterised by substantially higher inflation and strong economic recovery. The Finnish economy has also started to recover fairly quickly from the downturn caused by COVID-19, which has been reflected in higher payroll figures reported by our customers,” says Carl Pettersson, who took up his post as Elo’s new CEO on 7 October.

“I’m pleased to start developing this company from a solid foundation. Elo’s investments have generated good returns, solvency has improved and customer satisfaction is excellent. The development of Elo’s governance, which is being assessed by the Financial Supervisory Authority, and the clarification of the management system and risk management are proceeding as planned and on schedule,” Pettersson adds.

Private equity investments generated excellent returns

Slowing economic growth combined with accelerating inflation has created challenges in the business environment for companies as well as the investment markets.

“Equity market performance was strong in the early part of the year, but volatility has increased since the summer and there has been a divergence in returns between regions,” says Chief Investment Officer Hanna Hiidenpalo.

In Finland, construction investments and private consumption drove a brisk economic recovery in the summer. The recovery of the global industrial cycle, particular in Europe, has accelerated the revival of Finnish industry and exports. Industrial production returned to the pre-pandemic level in the summer.

At the end of September, the average 10-year nominal return of Elo’s investments was 6.7 per cent and the average 10-year real return was 5.6 per cent. The average 5-year nominal return was 6.6 per cent and the average 5-year real return was 5.5 per cent. The result of investment operations at fair values was EUR 999.7 million (EUR -798.0 million). The highest returns during the review period were achieved in private equity investments at 30.7 (2.4) per cent, unlisted equities at 16.6 (6.5) per cent and listed equities at 14.1 (-6.6) per cent.

“The performance of private equity funds has remained particularly strong this year. Strong equity market has increased M&A activity. The portfolio companies have shown a positive profit performance compared to last year,” Hiidenpalo adds.

Activity in the real estate investment market has picked up. The main focus of real estate investments was on ongoing commercial and residential construction projects. During the review period, 95 new apartments were completed and approximately 300 apartments are under construction or renovation.

In the developed Western countries, the fixed income markets stabilised after high volatility in the early part of the year. Corporate bond investments generated positive returns due to the low number of corporate bankruptcies globally as well as lower loan margins particularly in higher-risk corporate bonds. The hedge fund portfolio generated fairly good returns in the third quarter, but the returns were substantially more moderate than earlier in the year.

The improving COVID-19 situation is reflected in the insurance business

The improved COVID-19 situation was again favourably reflected in the development of the payroll of Elo’s client companies in July–September. The TyEL payroll total for the period 1 January–30 September 2021 was 5.1 per cent higher than in the corresponding period last year.

In January–September, TyEL credit losses were lower than last year and in the previous years. Payment plans have still been drawn up with customers. As the uncertainty arising from COVID-19 is diminishing, credit losses are not expected to increase significantly from the level seen at the beginning of the year.

The number of Elo’s employer customers increased year-on-year. At the end of September, Elo administered 51,000 (47,800) TyEL insurance policies. Premiums written totalled EUR 3.0 (2.7) billion, representing a return to the pre-pandemic level. The third transfer period of the year saw development in two directions: the transfer period was negative for Elo in terms of premiums written but positive in terms of the number of customers.

A total of 7,832 new YEL insurance policies were added during the period. At the end of the period, Elo administered 83,900 (83,000) YEL insurance policies for self-employed persons. The total number of self-employed persons and employees insured by Elo was 500,700 (484,900). Elo is the market leader in YEL pension insurance, and one in three employer companies use Elo to insure their employees.

Smooth employment pension services for customers

The customer satisfaction of insurance and pension services continued to develop favourably in light of the NPS scores. After the end of the review period, Elo won a silver prize in the Customer’s Voice competition for our telephone service for insurance customers.


Pension processing has remained smooth even during the COVID-19 pandemic. For example, decisions on old-age pensions were issued in two days on average. The speed and quality of decision-making is a key goal for us as we look to ensure the continuity of our customers’ income when they transition from working life to retirement. A total of 245,800 (242,900) pensioners were paid their pensions by Elo at the end of September. A total of EUR 3.0 billion (EUR 2.9 billion) was paid in pensions and other benefits during the reporting period. Elo issued a total of 19,500 (19,350) pension and rehabilitation decisions. 

Corporate governance


Carl Pettersson took up his post as Elo’s new CEO after the review period, on 7 October 2021. Pettersson previously served as the CEO of Veritas Pension Insurance Company from 2017 until spring 2021. He has also held several positions at Aktia, for example. Elo’s Chief Investment Officer Hanna Hiidenpalo was appointed as Deputy CEO effective from 7 October 2021. Hiidenpalo previously served as the interim CEO.


The FIN-FSA appointed attorney Pekka Jaatinen, LLM, as an authorised representative on 11 December 2020 to supervise the activities of Elo. The FIN-FSA will review the need to continue the appointment of the authorised representative in April 2022 at the latest. During the past year, the company has taken several measures to develop its corporate governance, management system and risk management. The development efforts are progressing as planned and on schedule.


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

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


Further information:

CEO Carl Pettersson, interview requests to Head of Communications Hanna Saira, tel. +358 50 387 5742

Deputy CEO, CIO Hanna Hiidenpalo, tel. +358 20 703 5668

CFO Sarianne Kirvesmäki, tel. +358 20 703 5134


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