Return on investment

Return on investment
  31.12.2012 31.12.2011
Current return 3,9% 4,3%
Harvesting rate -0,3% -0,7%
P&L return 3,7% 3,6%
Comprehensive return 11,7% 0,1%

The current return of life segment investments declined from 4.5% at 31 December 2011 to 4.1% owing to lower current income from the bond portfolio, due, in particular, to the de-risking policy on government bonds and equity portfolio, as well as to the incidence of cash, althought decreasing. 

Instead, the contribution to the result of the period from harvesting operations improved, amounting to −0.3% −0.7% at 31 December 2011), which benefitted from both the decrease in impairment, in particular on bond portfolios, and the recovery in value of investments recognized through profit and loss.

The comprehensive return increased significantly from 0.1% at 31 December 2011 to 11.7%. This trend was attributable to the improvement in the financial markets conditions, which determined a recovery in value of equity and, mainly, bond portfolios recognized in particular in other comprehensive income, compared the drop in value of bond investments observed from the second quarter of 2011 due to the tensions surrounding the sovereign bonds of countries of the Euro Area with high public sector debt.

Business performace of life segment
(€ million) 31.12.2012 31.12.2011 Fourth quarter
2012
Fourth quarter
2011
Net operating income from financial instruments at fair value through profit or loss 5,937 -3,055 1,615 1,167
of which net income from financial assets and liabilities related to unit and index -linked policies 4,563 -3,159 1,155 988
Net operating income from other financial instruments 8,600 9,336 1,285 2,474
Interest income and other income 10,441 11,030 2,553 2,788
Net operating realized gains on other financial instruments and land and buildings (investment properties) 967 2,019 455 554
Net operating impairment losses on other financial instruments and land -1,979 -2,967 -1,469 -667
Interest expense on liabilities linked to operating activities -309 -269 -107 -66
Other expenses from other financial instruments and land and buildings (investment properties) -521 -476 -146 -134
Net non-operating income from other financial instruments -754 -579 -527 -189
Net non-operating realized gains on other financial instruments and land and buildings (investment properties)(1)
-164 -143 -95 -48
Net non-operating realized gains on other financial instruments and land and buildings (investment properties)(1)
-590 -436 -433 -141

(1) The amount is net of the share attributable to the policy holders

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Investment yields67.81 KB
Life investment strategy and yields92.59 KB