POSITIVE CONTRIBUTION FROM NON-LIFE AT ESFG

Portuguese financial services group Espirito Santo Financial (ESFG) said today that its insurance business Tranquilidade had made a positive contribution in the first half, despite a stagnant Portuguese non-life market. Earned premiums net of reinsurance in the first half fell 12.8% to €153.1m ($215.9m). Claims fell 3.1% year on year to €112.2m. Tranquilidade recorded an 11.7% fall in gross written premiums compared with H1 2008, “primarily due to a fall in motor premiums”. The company said that measures had been put in place to reduce customer loss and that “Tranquilidade expects significant improvement in churn rates in the second half of 2009”. Although personnel costs were cut by 4.9% year on year, the expense ratio still rose because of the fall in premium income. The company’s direct insurance operation Logo has now gained more than 50,000 clients. Although still loss-making, ESFG said that the number of clients and premiums was ahead of budget. Pre-tax profit for the group as a whole fell 6.5% year on year to €324m