Irish Life adds €36m to its Canadian parent’s bottom line as profits rise by 33pc

Irish Life added €36m to its Canadian parent’s profits in the third quarter of the year, up by a third on the same period in 2015.

The insurer launched its new Irish Life Health business in September, shaking up the sector following its acquisitions of Aviva Health and the 51pc stake it did not already own in GloHealth.
Last night, Great-West Lifeco announced results for the three months ended September 30, 2016, and said its Irish Life unit had contributed €36m of profits in the period, an increase of 33pc compared to the same quarter last year.

The Canadian insurance group bought Irish Life in 2013 from the State, which had ended up in control of the business following the effective nationalisation of the former Irish Life and Permanent in the wake of the financial crash.
At Irish Life the third quarter of this year marked a number of important developments for the company, group chief executive David Harney said.

“In September we successfully launched Irish Life Health as a new force in the Irish health insurance market,” Mr Harney said. “We are very pleased with the positive response including the decision of a number of corporate clients to transfer their company schemes to Irish Life Health.
“Also during the third quarter, the total investor assets in Irish Life’s Multi-Asset Portfolio Strategies reached close to €6bn, including €2bn by 35,000 investors in Retail MAPS funds,” he said.

Meanwhile, Europe’s top court is due to rule this week on whether the Government breached European law when it took control of IL&P.
A group of shareholders, including a former non-executive director of the group, Piotr Skoczylas, had sought to prevent the 2011 recapitalisation.

They have argued that the Government did not have the power under emergency banking laws to freeze out existing shareholders when taxpayer funds were pumped in, diluting the stake held by the previous investors.
The Finance Minister, Michael Noonan, has said that decision to recapitalise IL&P was made to fulfil the Government’s legal obligations, and that failure to recapitalise would probably have led to the collapse of the bank.

In 2014, the High Court judge hearing the case referred it to the European Court of Justice (ECJ). A decision is imminent.
The ECJ was asked to consider whether it was legal for an order to be made under the Credit Institutions Act to increase a company’s capital without the consent of a general meeting, and allotting new shares without offering them on a pre-emptive basis to existing shareholders.

The ECJ was asked to determine if such moves were precluded under a relevant company law directive.

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