By Don Burgess, Deputy Editor BDA Sun

BF&M CEO and president John Wight said: “The company’s balance sheet continues to be very strong. Equity attributable to shareholders at 30 September 2013 was $217.1 million. General fund assets totaled $1.1 billion of which $99.7 million was held in cash and short term deposits. Based on the company’s strong balance sheet, the board of directors maintained the dividend of 20 cents per share for shareholders of record at 31 December 2013.

BF&M Limited’s net income for the nine-month period ending September 30, 2013 was $15.8 million.

This, resulted in an annualized return on shareholders’ equity of 10%. Shareholders’ net income for the comparative nine-month period of 2012 was $13.7 million. President and CEO John Wight said in a press release: “Financial results for the first nine months of 2013 were up 15 per cent from the corresponding period in 2012. The company’s core operations relating to insurance and investment advisory and administration services continued to perform well, despite the ongoing challenges that impact our individual, commercial, and group customers in Bermuda, Barbados, and Cayman, where the majority of the business is operated from.

Mr. Wight added “The company’s balance sheet continues to be very strong. Equity attributable to shareholders at 30 September 2013 was $217.1 million. General fund assets totaled $1.1 billion of which $99.7 million was held in cash and short term deposits. Based on the company’s strong balance sheet, the board of directors maintained the dividend of 20 cents per share for shareholders of record at 31 December 2013.”

When comparing the results of 2013 with 2012, it is important to note that BF&M Limited acquired Island Heritage Holdings, Ltd., a leading Caribbean company with extensive insurance operations, on March 30, 2012. Last year’s third quarter results for BF&M did not include the 2012 first quarter financials of Island Heritage.

Gross premiums written for the period were $273.0 million, an increase of 10 per cent over 2012.

Investment income for the nine months reflected a $19.3 million decrease in the value of investments for the period as the marginal increase in interest rates decreased the fair value of the company’s extensive fixed income portfolio. Offsetting this was an $18.2 million decrease in the value of policyholder benefits as a result of the company’s disciplined asset liability matching policy, which limits volatility of reported earnings as a result of interest rate swings in either direction. Commission and other income decreased 3 per cent to $29.8 million.

Short term claims and adjustment expenses increased by 8 per cent to $18.3 million and life and health policy benefits decreased by 26 per cent to $58.5 million. Operating expenses increased 5 per cent to $46.8 million.

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