KLP delivers good surplus return to customers in volatile financial markets
The surplus return to customers amounts to NOK 21,124 million in the quarter, and NOK 17,073 million so far this year.
Return of 3.1 per cent on the pension assets in the common portfolio after the second quarter.
Upwards adjustment of pension liabilities of NOK 26.9 billion following the national insurance settlement in May.
Early repayment of subordinated loan of EUR 294 million in June.
KLP – a customer-owned group with a 75-year history
The KLP Group is made up of the following companies: Kommunal Landspensjonskasse (KLP) and its subsidiaries the KLP Banken Group, KLP Skadeforsikring, KLP Kapitalforvaltning, KLP Forsikringsservice and KLP Eiendom.
At the end of the second quarter of 2025, the Group had total assets of NOK 1,194.8 billion.
Public-sector occupational pensions
Results for the second quarter
NOK MILLIONS
Customers
Company
Total
Return result collective portfolio
21 124
126
21 250
Return result unit-linked portfolio
105
105
Risk result
-90
-90
Interest guarantee premium
6
6
Administration result
59
59
Net income from investments in the corporate portfolio and other income/expenses in the non-technical accounts
771
771
Tax
-167
-167
Other comprehensive income
-92
-92
Result in Q2 2025
21 139
703
21 842
Result in Q2 2024
7 764
677
8 441
Results for the year to date
NOK MILLIONS
Customers
Company
Total
Return result collective portfolio
17 073
124
17 197
Return result unit-linked portfolio
64
64
Risk result
78
78
Interest guarantee premium
8
8
Administration result
32
32
Net income from investments in the corporate portfolio and other income/expenses in the non-technical accounts
1 003
1 003
Tax
-212
-212
Other comprehensive income
-92
-92
Result after Q2 2025
17 215
863
18 078
Result after Q2 2024
26 464
926
27 390
Investment result
KLP manages the pension capital that covers the entitlements that have been accrued. The pension capital is mainly managed in the common portfolio.
The pension money has to be paid out over many years, so part of this amount can be financed from the return on the pension capital (guaranteed return).
KLP has guaranteed to provide customers on public-sector occupational pensions with financial income equivalent to NOK 7.4 billion after the second quarter. Actual financial income amounted to NOK 24.7 billion, a return of 3.1 per cent, so the investment result was NOK 17.3 (26.4) billion.
Return on capital as of 30 June
Q2 2025
Year to date 2025
Q2 2024
Year to date 2024
Collective portfolio
3,1 %
3,1 %
1,5 %
4,6 %
Including value change at amortised cost
3,7 %
3,7 %
1,7 %
4,4 %
Unit-linked
3,9 %
3,1 %
1,7 %
5,8 %
Including value change at amortised cost
4,6 %
3,8 %
1,9 %
5,8 %
Management of the common portfolio
The assets in the common portfolio totalled NOK 825.7 (761.8) billion:
30.06.2025
30.06.2024
Assets
Share
Return Q2
Return year to date
Share
Return Q2
Return year to date
Equities and alternative investments
35,1 %
6,0 %
3,7 %
34,0 %
2,5 %
10,5 %
Long-term bonds
25,9 %
0,9 %
1,8 %
28,0 %
1,0 %
1,8 %
Real estate
13,5 %
2,7 %
4,4 %
13,2 %
1,5 %
1,1 %
Lending
10,7 %
1,2 %
2,4 %
11,2 %
1,1 %
2,2 %
Short-term bonds
10,8 %
2,3 %
3,5 %
10,8 %
1,1 %
1,6 %
Liquidity/money market
4,1 %
1,3 %
2,6 %
2,8 %
1,4 %
2,7 %
Shares and alternative investments
Total exposure in listed and unlisted shares and special funds, including equity derivatives, was 35.1 per cent at the end of the second quarter. The total return on shares and special funds was 6.2 per cent in the quarter. The return on KLP’s global exchange-listed equities was 7.5 per cent, while its Norwegian equity portfolio returned 7.8 per cent in the second quarter.
The currency hedging ratio for equities in developed markets and the most liquid currencies in emerging markets was between 40 and 60 per cent. In the second quarter, the Norwegian krone strengthened against the US dollar. Currency hedging had a positive impact on the return on shares this quarter.
Of the total portfolio of securities (shares and bonds), approximately 85 per cent are currency-hedged.
Short-term bonds and money market instruments
Short-term bonds accounted for 10.8 per cent and money-market instruments 4.1 per cent of the assets in the common portfolio at the end of the quarter. Long-term government rates in Norway fell in the second quarter. KLP’s global government bond index achieved a currency-hedged return of 2.4 per cent in the quarter, while the return on the Norwegian government bond index was 1.4 per cent. Global credit margins decreased during the quarter. The quarterly return on KLP’s global credit bond index was 1.9 per cent, while the return on the Norwegian credit bond index was 2.7 per cent. Short-term bonds etc. in the common portfolio produced a total return of 2.3 per cent in the second quarter. The money market return was 1.3 per cent for the quarter.
Long-term bonds
Investments in bonds measured at amortised cost made up 25.9 per cent of the common portfolio at the end of the quarter. Unrecognised decreases in value in the portfolio amounted to NOK 6.0 billion at the end of the second quarter. The portfolio is well diversified and consists of securities issued by creditworthy borrowers. The return measured at amortised cost in this quarter was 0.9 per cent.
Property
Property investments, including Norwegian and international real estate funds, made up 13.5 per cent of the common portfolio.
Property investments in the common portfolio achieved a return of 2.7 per cent in the second quarter. The returns include currency hedging.
Lending
Lending in the common portfolio totals NOK 86.9 billion. This is split between NOK 78.1 billion in loans to the public sector, NOK 3.4 billion in secured mortgage loans and NOK 5.4 billion in loans outside Norway secured against mortgages or government guarantees. The lending portfolio is of high credit quality, with no losses on municipal loans and very modest provisions for losses on mortgage-backed loans. Unrecognised decreases in value in the lending portfolio totalled NOK 0.8 billion at the end of the quarter. The return for the second quarter is 1.2 per cent.
Risk result
The risk result is an expression of how mortality and disability have developed in the insured population in relation to the assumptions used in the annual setting of premiums.
The risk result amounted to NOK -90 (-1) million in the second quarter, and NOK 78 (81) million after the first half-year. Disability rates are still high, pulling down the risk result. The risk result related to mortality shows a surplus, with a positive effect on the overall result.
Administration result
The difference between the cost elements within premium income, withdrawals from management reserves and insurance-related operating expenses constitutes the administration result. The administration result shows a profit of NOK 59 (73) million in the second quarter. So far this year, the administration result comes to NOK 32 (65) million. Insurance-related operating costs came to NOK 397 (361) million in the second quarter and NOK 877 (793) million in the year to date.
Net income from investments in the corporate portfolio and other income/expenses in non-technical accounts
Investments in the corporate portfolio amount to NOK 43.9 (44.3) billion at the end of the quarter. The corporate portfolio is managed with a moderate-risk long-term investment horizon, with the objective of stable returns. Revenue from investments in the company portfolio amounted to NOK 838 (588) million in the second quarter, and NOK 1,119 (734) million so far this year. KLP has delivered a return of 1.8 per cent for the second quarter, and 2.4 per cent for the year to date.
Other income/expenses in non-technical accounts amount to NOK -66 (-54) million in the second quarter, and NOK -116 (-125) million so far this year. This item consists mainly of interest on subordinated loans and hybrid Tier 1 capital.
Premium income
Premium income excluding premium reserves received on transfers in amounted to NOK 42.7 (37.3) billion at the end of the second quarter. Of this, premiums related to the settlement of accrued pension rights amount to NOK 26.9 (22.0) billion.
Claims/benefits
Pensions paid and other claims, excluding ceded premium reserves, amounted to NOK 14.3 (13.7) billion at the end of the second quarter.
Financial strength and capital-related matters
KLP’s total assets increased by NOK 43.7 billion in the second quarter and amount to NOK 909.7 billion. The premium reserve increased by NOK 31.2 billion to NOK 646.7 billion in the same period.
The buffer fund amounts to NOK 122.3 billion after the second quarter. The fund can be used to cover any shortfall in returns on the pension capital and constitutes a financial buffer.
KLP’s subordinated loan of EUR 294 million was repaid early, in June 2025, in line with the standard terms and conditions for the loan. The loan qualified as Tier 2 capital under the Solvency II rules. Repayment of the loan had no material impact on capital adequacy.
Without applying transitional rules, the Company’s solvency capital requirement (SCR) is 336 per cent. This is a reduction of 19 percentage points in the quarter. The reduction is mainly due to decreased interest rates in the second quarter, along with growth in the premium reserve following an upward adjustment of pension rights arising from changes in salary and G levels.
KLP’s target is for capital adequacy to exceed 150 per cent. Solvency is well above this target and thus enables sound and stable management of customer assets in a multi-year perspective.
Other matters
In the second quarter, KLP decided to invest NOK 1,150 million in a new property fund that will buy and rent important buildings such as care homes, health centres, nursing homes, schools and colleges and student accommodation throughout the country. A collaboration with the state-owned company Allstad, which owns land in over 300 municipalities, provides for rapid and good-quality development. We hope this will help to provide municipalities with a good financing option within the health and care sector, where the needs are increasing with growing numbers of old people, and there are large distances and worn-out buildings. The fund is also an attractive place to invest the pension assets that KLP manages, as it offers long leasing contracts with low risk.
The market situation for public-sector occupational pensions is stable. So far this year,one county authority has invited tenders for public-sector occupational pension provision. As a result of the tendering procedure, the county decided to move its scheme to KLP from 1 January 2026 onwards. We look forward to welcoming the county authority to KLP.
Storebrand filed a complaint against Norway with the ESA in 2022, alleging that KLP is receiving unlawful state aid, and that Norwegian municipalities and health trusts have breached the rules on public procurement. The government has dismissed both complaints, and the ESA has still not opened proceedings on either of them.
Non-life insurance
Non-life insurance
MILLION NOK
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
Insurance income
746,3
657,9
1 532,4
1 364,9
Insurance service expenses
-566,6
-417,7
-1 154,8
-1 111,7
Operating expenses
-93,6
-82,8
-212,6
-185,9
Insurance service result before reinsurance
86,1
157,4
165,0
67,3
Reinsurance result
-28,6
-27,3
-97,7
-133,0
Insurance service result after reinsurance
57,5
130,0
67,3
-65,7
Financial income
135,7
74,8
179,5
171,5
Net financial result from insurance and reinsurance
-33,1
-23,7
-54,6
-42,6
Other insurance-related income/expenses
0,2
0,2
0,4
0,6
Profit before tax
160,2
181,3
192,6
63,7
Tax
-40,1
-45,3
-48,1
-15,9
Profit before other income and expenses
120,2
136,0
144,4
47,7
Other income and expenses
-10,5
10,5
-10,5
27,4
TOTAL COMPREHENSIVE INCOME
109,7
146,5
133,9
75,2
A positive underwriting result from the present claims year and good financial income in the second quarter have contributed to good performance for the quarter and for the year to date. Premium growth continued in all segments.
The second quarter of 2025 produced a pre-tax profit of NOK 160.2 (181.3) million. The underwriting result was good in the second quarter. No claims affecting the company's reinsurance programme, and no major natural perils, were reported during the period. An increase in previous years’ reserves had a negative impact on the result. Good returns in the financial markets in the second quarter contributed to higher-than-expected financial income.
So far this year, the business has achieved a profit before tax of NOK 192.6 (63.7) million. This is slightly better than expected, and is due to the good underwriting result for this year’s business, as well as good financial returns.
Volume growth so far this year is NOK 301 million, and premium volume was NOK 3,141 (2,750) million at the end of the second quarter of 2025. The increase is mainly due to good sales in the autumn 2024 procurement round, and slightly increased premium rates. Insurance income increased by NOK 167 million, or 12.3 per cent, compared to the same time in 2024, and amounts to NOK 1,532 million for the first half-year. The retail market shows growth of NOK 78 million, or 14.1 per cent, while the public-sector and corporate market shows growth of NOK 89 million, or 11.0 per cent.
One claim over NOK 20 million was reported in the second quarter, and two such claims have been filed so far this year, with total damages of NOK 46 million. So far this year, both the number and size of reported claims are smaller than expected. This is a factor in the good underwriting result.
Reversals of previous years’ claims are still slightly negative in the second quarter, and NOK 36 million have been recognised so far this year, equivalent to 1.4 per cent of the reserves at the beginning of the year.
Key figures
30.06.2025
30.06.2024
31.12.2024
Claims ratio
75,4 %
81,4 %
77,3 %
Reinsurance percentage
6,4 %
9,7 %
6,4 %
Cost ratio
13,9 %
13,6 %
13,0 %
Combined ratio
95,6 %
104,8 %
96,8 %
Net financial income as of 30.06.2025 was NOK 179.5 (171.5) million, equivalent to 2.7 (2.9) per cent. The year to date has been marked by great variation in the international financial markets. Overall, the equity portfolio had a return of 3.7 per cent, where global returns have been weaker than in the Norwegian market. The company’s investments in fixed-income funds had a positive return of 3.8 per cent. The return on property investments was 2.4 per cent.
The second quarter of 2025 showed positive returns in all sub-portfolios, with the equity portfolio producing the best return, at 7.8 per cent. The return on the fixed-income funds was 1.7 per cent. The property portfolio had a positive return of 1.1 per cent. Overall, the quarterly return was 2.0 per cent.
The solvency margin (SCR) fell slightly from 246 per cent in the first quarter to 242 per cent at the end of the second quarter of 2025. The equivalent SCR at the end of 2024 was 256 percent.
For all of its market segments, the company is well positioned for further growth, and the insurance returns are satisfactory. A significant part of the company’s value creation comes from the return on financial assets, which means that the prevailing geopolitical uncertainty can affect the company’s overall earnings.
Asset and fund management
Asset management
Asset management
MILLION NOK
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
Fee income
139,0
148,2
282,5
297,8
Operating expenses
-115,9
-113,7
-277,5
-260,5
Net financial income
9,2
6,7
19,0
15,8
Profit before tax
32,3
41,1
24,0
53,1
Tax
-8,1
-10,3
-6,0
-13,3
PROFIT
24,2
30,8
18,0
39,8
Assets under management
MILLION NOK
30.06.2025
30.06.2024
31.12.2024
External clients
254
214
238
Group internal clients
656
604
641
Total assets under management
910
818
879
KLP Kapitalforvaltning AS handles securities management in the KLP Group. It had a total of NOK 910 billion under management at the end of the second quarter, NOK 254 billion of it on behalf of external customers.
Net new subscriptions to the KLP funds were NOK 8.1 billion in the second quarter. External customers had positive net new subscriptions of NOK 7.2 billion in the same period.
So far this year, net new subscriptions in the KLP funds have totalled NOK 13.9 billion. Of this, external customers had net new subscriptions of NOK 12.3 billion. NOK 12.6 billion, comes from institutional customers, while retail customers have withdrawn around NOK 300 million, largely in response to the turmoil in the financial markets.
KLP Kapitalforvaltning achieved a pre-tax profit of NOK 32.3 (41.1) million in the second quarter and NOK 24.0 (53.1) million for the year to date. Fee income in the second quarter decreased from NOK 148.2 million to NOK 139.0 million compared to the second quarter last year, even though the managed volume increased. This was mainly due to the introduction of new net share classes for major customers who subscribe through distributors. The change reduces the income on the top line, with a corresponding reduction in distribution payments.
Banking
MILLION NOK
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
Net interest income
138,0
127,9
271,0
254,6
Net charges and commission income
9,0
8,4
16,8
15,1
Other fee income
15,6
15,7
31,3
31,3
Net financial income
7,8
-1,0
9,1
5,9
Operating expenses
-62,8
-59,3
-144,0
-139,9
Profit before tax
107,5
91,8
184,2
166,9
Tax
-6,6
-5,1
-5,5
-6,1
Profit before other income and expenses
101,0
86,7
178,7
160,9
Other income and expenses
-4,3
4,6
-4,4
12,3
TOTAL COMPREHENSIVE INCOME
96,7
91,3
174,3
173,1
The KLP Banken Group achieved a pre-tax operating profit of NOK 184.2 (166.9) million at the end of the first half-year. For the second quarter in isolation, the profit was NOK 107.5 (91.8) million. The main reason for the rise in profits is that net interest income from the retail market and income from financial instruments have increased more than the bank’s costs in relative terms.
Broken down by area, pre-tax profits were NOK 140.7 (121.9) million in the retail market and NOK 43.5 (45.0) million in the public-sector market. After tax and estimate differences, the Group’s total profit was NOK 174.3 (173.1) million.
Net interest income in the KLP Banken Group for the first half-year was NOK 271.0 (254.6) million. The increase is mainly due to slightly lower borrowing costs resulting in increased margins between lending and financing in the retail market. A big increase in deposits from retail customers was another factor.
At the end of the quarter, the income statement includes net income of NOK 9.1 (5.9) million from changes in the value of financial instruments. This profit/loss effect is mainly related to loan buy-backs and changes in the market value of the bank’s liquidity investments.
Operating costs before losses and loan loss provisions taken to profit/loss amount to NOK -144.7 (-140.0) million for the first quarter.
Losses and loan loss provisions taken to profit/loss (included in “Operating expenses” in the table above) so far in 2025 total NOK 0.7 (-0.0) million in the retail market. The change from the same period last year is largely due to the reversal of historical loan loss provisions. KLP Banken does not believe that losses and loss provisions on mortgages and credit cards have increased significantly from last year. Nor have we seen any losses related to public-sector lending so far in 2025.
Lending volume (principal before loss provisions and excluding interest accrued but not paid)
MILLION NOK
30.06.2025
30.06.2024
31.12.2024
Mortgages
24 374
24 415
24 067
Public sector loans
19 617
18 231
18 595
Total loans KLP Banken
43 991
42 646
42 662
Mortgages financed from pension funds in KLP
3 386
2 678
3 435
Public sector loans financed from pension funds in KLP
75 075
73 149
74 822
Other loans financed from pension funds in KLP
5 983
6 508
6 699
Total loans financed from pension funds in KLP
84 444
82 335
84 956
Total loans managed by KLP Banken
128 435
124 981
127 618
KLP Banken manages lending on its own account and loans financed by KLP totalling NOK 128.4 (125) billion. On its own balance sheet, the KLP Banken Group had loans to customers totalling NOK 44 (42.6) billion at 30 June 2025. Mortgage loans in the retail market and public-sector loans totalled NOK 24.4 billion and 19.6 billion (NOK 24.4 and 18.2 billion) respectively.
The KLP Banken Group manages NOK 3.4 (2.7) billion in mortgage loans and NOK 81 (79.7) billion in loans to public-sector borrowers and other businesses on behalf of KLP.
The Bank’s mortgage products are aimed at the target group of members of the KLP pension schemes. Net total mortgage growth so far in 2025 is NOK 258 (536) million. New mortgage payments so far this year amount to NOK 3.9 (3.9) billion.
Lending volume to the public-sector market on KLP Banken’s balance sheet has increased by NOK 1.0 (-0.7) billion so far this year. Loans to public-sector borrowers managed on behalf of KLP increased by NOK 0.3 (1.8) billion in the same period. New payments of public-sector loans so far in 2025 amount to NOK 5.5 (4.2) billion for KLP and KLP Banken together.
The KLP Banken Group’s external financing consists of deposits and bonds. At the time of reporting, deposits from individuals and businesses amounted to NOK 17.4 (15.8) billion. Deposit growth so far this year is NOK 1.1 (1.3) billion. Liabilities created on issuance of securities totalled NOK 30.2 (30.8) billion. The securities debt is mainly covered bonds issued by KLP Kommunekreditt AS and KLP Boligkreditt AS.
Solvency
The Capital Requirements Regulation (CRR3) entered into force in Norway on 1 April 2025. The new rules entail lower capital requirements for mortgage loans for banks that use the standard method to calculate their capital requirements related to credit risk, as the KLP Banken Group does. The changes help to create more equal competition between the standard method banks and the larger banks that use internal measurement methods to determine their capital requirements related to credit risk, the so-called IRB (internal-ratings-based) banks. For the KLP Banken Group, the new rules mean an easing of the capital requirement of between NOK 400 and 500 million.
CAPITAL ADEQUACY
30.06.2025
30.06.2024
31.12.2024
Core capital adequacy
26,9 %
20,9 %
22,7 %
Capital adequacy
26,9 %
20,9 %
22,7 %
Leverage ratio (core capital)
6,4 %
6,1 %
6,5 %
Group
KLP is a mutual insurance company which produces consolidated financial statements in accordance with IFRS Accounting Standards®. These accounting rules reflect the fact that KLP is a mutual insurance company where all value creation accrues to policy-holders and is posted as a liability to them as part of the overall insurance liability.
The liability to policy-holders comprises the discounted value of the best estimate related to future premiums received, claims payments and operating costs that are expected to arise from the insurance contracts. As these are estimates, a risk adjustment for non-financial risk also has to be determined and added to the insurance liability. The fair value of the assets deducted from the insurance liability and other liabilities (the “residual value”) then accrues to the policyholders who own KLP and is included in the insurance liability. The Group therefore has no profits or equity. However, some technical equity may still arise if individual assets or liabilities have been measured at anything other than fair value in the balance sheet. The equity will then represent the difference between the book value and the fair value of net assets (the “measurement difference”), which will be posted as a net gain/loss.
Income statement
MILLION NOK
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
Insurance income
794
1 008
2 372
2 242
Insurance expenses
-1 069
-872
-2 266
-2 112
Reinsurance income and expenses
-29
-27
-98
-133
Insurance service result
-304
109
9
-2
Net investment income
29 994
13 641
30 732
33 698
Policyholders’ share of change in fair value of underlying items
-29 237
-12 307
-29 646
-32 144
Other insurance-related financial expenses and income
-33
-24
-55
-43
Net insurance service and financial result
419
1 419
1 041
1 508
Other income and expenses in ordinary result
607
-20
440
-566
Profit before tax
1 026
1 399
1 480
942
Tax
-567
-445
-857
-763
Profit before other comprehensive income
459
953
623
179
Other income and expenses
577
-419
425
405
TOTAL COMPREHENSIVE INCOME
1 036
534
1 048
584
Balance sheet
MILLION NOK
30.06.2025
30.06.2024
31.12.2024
Assets measured at fair value
1 118 448
1 010 018
1 084 201
Other assets
76 389
69 263
63 188
TOTAL ASSETS
1 194 837
1 079 281
1 147 389
Best estimate of insurance liabilities
412 140
370 164
414 490
Risk adjustment for non financial risk
29 276
27 440
29 303
Residual value
424 916
398 797
395 820
Insurance obligations
866 331
796 401
839 613
Other liabilities
81 565
70 796
72 201
Unit holders`s interest in consolidated securites funds
249 195
214 640
238 879
Equity
-2 255
-2 556
-3 303
TOTAL LIABILITIES AND EQUITY
1 194 837
1 079 281
1 147 389
Profit/loss from insurance services amounted to NOK -304 (109) million in the second quarter, and NOK 9 (-2) million so far this year. Of the underwriting result so far this year, NOK 67 million comes from the non-life insurance contracts after reinsurance. This is an improvement of NOK 86 million in the quarter. The contracts for public-sector occupational pensions contributed a net profit from insurance services of NOK -58 million so far this year, after an underwriting result of NOK -362 million in the second quarter.
Total comprehensive income, which represents the change in the unrecognised added value of net assets measured at other than fair value, amounts to NOK 1,036 million in the quarter, and NOK 1,048 million so far this year. This means that the unrecognised added value has been reduced accordingly, and amounts to NOK 2,255 million as of 30.06. This added value constitutes the negative equity.
The best estimate of the insurance liability has been reduced by NOK 2,350 million to NOK 412,140 million for the year to date. The estimate is very sensitive to changes in the yield curve used to discount the incoming and outgoing payments expected on the insurance contracts. This yield curve is slightly higher at 30.06.2025 than 31.12.2024, and is the main reason why the best estimate of the liability has been reduced in the year to date.
The reduction of the best estimate of the insurance liability, combined with good financial income, has caused the residual value to increase by NOK 29,096 million so far this year. Of this increase, NOK 18,036 million came in the second quarter, mainly as a result of a good returns on the assets in the quarter.
Solvency
Capital adequacy at the consolidated level decreased by two percentage points to 288 per cent in the quarter. An increase in the premium reserve and falling interest rates contributed to reduced capital adequacy, but this reduction was more or less offset by lower capital requirements for banking activities.
Percent
30.06.2025
30.06.2024
Capital Adequacy Solvency II
288 %
283 %
Sustainability
Climate-friendly investments
As from the second quarter, KLP is using an updated definition and classification of climate-friendly investments. The update reflects KLP’s climate and nature goals, and gives a more holistic picture of the portfolio with several different types of investment which contribute to the green transition, while making clear what types of investment these are.
Climate-friendly investments include two main categories: climate and nature solutions, and transitional investments. Climate and nature solutions are investments that are considered to be in line with the low-emission society. Transitional investments are investments that contribute to emission cuts and help sectors that are hard to make emission-free to become more sustainable.
At the end of the second quarter, KLP’s climate-friendly investments accounted for 44 per cent of its financial assets. In the second quarter, these investments increased by around NOK 1.1 billion. This increase comes mainly from investments in a number of mutual funds which invest in renewable energy around the world.
KLP’s goal of net new investments in climate-friendly investments of NOK 6 billion a year is covered under climate and nature solutions.
NOK MILLIONS
Q2/2025
31.06.2025
31.12.2024
Amount invested
Fair value
Fair value
Climate and nature-based solutions
1 134
58 549
58 643
- As a share of KLP’s investments
-
7 %
7 %
Renewable energy
1 141
51 093
51 503
Nature-positive investments
-
3 003
2 840
Infrastructure
-6
4 454
4 300
Transitional financing
322 867
284 018
- As a share of KLP’s investments
-
37 %
33 %
Green buildings
-
34 944
34 381
Green bonds and loans
-
23 164
18 497
Companies with science-based climate targets (SBTi)
-
264 758
231 140
Total climate-friendly investments
1 134
381 416
339 828
- As a share of KLP’s investments
44 %
40 %
Active ownership
In the second quarter, we focused on establishing dialogue with companies on a decent living wage. Low wages have increasingly been used by companies as a tool to preserve competitiveness in a challenging market. This is particularly prevalent in the production of consumer goods and capital items, where workers are most exposed to downward pressure on wages. So far, we have contacted 17 companies in these sectors and held several meetings to raise the issue and clarify KLP’s expectations regarding a decent living wage.
In June, KLP and the KLP funds decided to exclude two weapons manufacturers based on KLP’s exclusion criterion of “sales of weapons to states in armed conflicts which use the weapons in ways that constitute serious and systematic breaches of international law”. In June 2024, KLP was informed by the UN that several named companies were supplying weapons or equipment to the Israeli military (IDF) and that these weapons were being used in the war in Gaza. Based on this information, KLP has made thorough assessments of the companies and entered into discussions with them. Our conclusion is that the companies Oshkosh and ThyssenKrupp violate KLP's guidelines as a responsible investor.
Prior to the general meeting season, KLP sent letters to over 30 Norwegian companies concerning our expectations for transparency in remuneration reporting and the use of options. We have received a good response from the companies and note that several Norwegian companies are showing increased transparency in their reports, as well as actual or promised revisions of their remuneration structure.
Change in the Board of Directors
As part of the ordinary election of board representatives from the employees (two board members), Eirik Johansen was elected to the Board of Directors. He replaces Erling Bendiksen. Vibeke Heldal was re-elected.
Events after the balance-sheet date
NOK 1,395 million was paid in owners’ equity contributions in the third quarter. This is in line with normal practice for the payment of owners’ equity contributions to KLP from the members. This will be reported as equity in the third quarter, and included as solvency capital from the same quarter.
Outlook
KLP is exposed to fluctuations in financial markets through its management of pension assets. There is still considerable uncertainty as to what the ongoing trade tensions between the US and several trading partners, particularly the EU, China, and Norway, will mean for the companies’ earnings and hence for the financial markets. We may expect to see some volatility in the financial markets going forward. For a number of years, KLP’s owners have focused on building financial buffers that enable good management even in turbulent financial markets.
The introduction of new rules for public-sector occupational pensions in 2020, taking effect from 2025, provides increased flexibility and incentives for working longer. As manpower shortages are a major challenge for KLP’s customers, the company will continue its work on guidance and digital solutions to support members in their pension choices and show the value of remaining at work for longer.
Increased digitisation and collaboration between pension providers ensures more efficient processes and better data quality. In the second quarter, KLP completed one of Norway’s most comprehensive digitisation programmes and launched a ground-breaking platform for pension processing. With a high degree of automation and self-service, both internally and in close cooperation with the public-sector occupational pension providers, KLP is setting a new standard for customer service and efficiency. The modern platform provides a powerful foundation for further innovation and development of future pension services, for the benefit of KLP’s customers and their employees.
KLP will also continue its work on sustainable investments and further development of financial services for the public sector, for the benefit of customers and members.
Oslo, 21 August 2025
The Board of Directors of Kommunal Landspensjonskasse gjensidig forsikringsselskap
TINE SUNDTOFT Chair of the board
TERJE ROOTWELT-REVHEIM Deputy chair of the Board
ODD HALDGEIR LARSEN
KJERSTIN FYLLINGEN
TORKILD SINDRE VARRAN
ELI ARNSTAD
VIBEKE HELDAL Elected by and among employees
Eirik Johansen Elected by and among the employees
SVERRE THORNES Group CEO
This document has been signed electronically
Income statement
KLP Group
NOTE
NOK MILLIONS
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
3, 5
Insurance service result
- 304
109
9
- 2
- 1 620
Net income from investments measured at fair value with changes in profit and loss
43 410
16 510
31 157
54 323
99 618
4
Fair value adjustment investment properties and rental income
2 720
1 446
4 250
1 475
5 011
Net income from associated companies and joint ventures
-314
64
85
-486
-38
Interest income, effective interest method
640
621
1 256
1 235
2 481
Interest expenses, effective interest method
-551
-536
-1 106
-1 065
-2 187
Unit holder's value change in consolidated securites funds
-15 017
-4 463
-4 013
-21 785
-38 287
Total net income
30 889
13 641
31 628
33 698
66 598
Policyholder's share of changes in fair value of underlying items
-29 237
-12 307
-29 646
-32 144
-63 663
Other insurance related financial cost
-33
-24
-55
-43
-84
5
Net insurance related financial cost
-29 270
-12 331
-29 700
-32 187
-63 747
Net insurance services and financial result
1 315
1 419
1 936
1 508
1 231
6
Net costs subordinated loan and hybrid Tier 1 securities
-109
128
38
-133
-451
Operating expenses
-184
-168
-430
-391
-808
Other expenses
3
20
-64
-42
-34
Pre-tax income
1 026
1 399
1 480
942
-61
Cost of taxes
-567
-445
-857
-763
-1 634
Income
459
953
623
179
-1 695
12
Change in actuarial asumptions own emplyees
-125
134
-125
332
442
Tax on items that will not be reclassified to profit or loss
19
-26
19
-53
-72
Items that will not be reclassified to profit or loss
-106
107
-106
280
370
Fair value adjustment of properties for own use
15
13
24
14
49
4
Translation difference foreign exchange
672
-537
514
115
1 124
Tax on items that will be reclassified to profit or loss
-4
-3
-6
-4
-12
Items that will be reclassified to profit or loss
683
-527
532
125
1 161
Total other comprehensive income
577
-419
425
405
1 531
Total comprehensive income
1 036
534
1 048
584
-163
Financial position statement KLP Group
NOTE
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Deferred tax assets
37
25
40
Intangible assets
1 627
1 517
1 551
Tangible fixed assets
2 331
2 299
2 312
Investments in associated companies and joint venture
7 012
6 017
6 820
4, 9
Investment property
104 311
95 529
98 889
5
Reinsurance contract assets
307
538
510
7, 9
Shares and units
491 649
421 518
477 165
7, 9
Fixed income securitites at fair value through profit or loss
429 562
404 610
419 077
7
Fixed income securitites at amortised costs
2 375
2 294
2 334
7, 9
Lending customers at fair value through profit or loss
87 872
84 057
87 092
7
Lending customers at amortised costs
44 204
42 804
42 836
7, 9
Financial derivatives
4 747
3 766
1 469
7
Receivables
13 890
9 564
3 534
Bank deposits
4 914
4 742
3 762
TOTAL ASSETS
1 194 837
1 079 281
1 147 389
7, 8, 9
Hybrid Tier 1 securities
1 308
1 356
1 429
7, 8, 9
Subordinated loan capital
0
3 358
3 560
12
Pension obligations
709
640
543
5
Insurance obligations
866 331
796 401
839 613
7, 8
Covered bonds issued
29 357
29 986
31 529
7, 8
Debt to credit institutions
6 570
3 286
1 395
7, 8
Liabilities to and deposits from customers
17 151
15 629
15 801
7, 9
Financial derivatives
4 436
3 218
11 304
Deferred tax liabilites
1 173
1 179
1 213
13
Other current liabilities
20 861
12 145
5 427
Equity
-2 255
-2 556
-3 303
Unit holders`s interest in consolidated securites funds
249 195
214 640
238 879
TOTAL EQUITY AND LIABILITIES
1 194 837
1 079 281
1 147 389
Changes in owners’ equity KLP Group
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Incoming balance 1. january
- 3 303
- 3 140
- 3 140
Income
623
179
- 1 695
Other comprehensive income
425
405
1 531
Total comprehensive income
1 048
584
- 163
Closing balance
- 2 255
- 2 556
- 3 303
Statement of cashflowKLP Group
NOK MILLIONS
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
Net cash flow from operational activities
-15 794
-12 799
-6 010
Net cash flow from investment activities 1
-174
-213
-428
Net cash flow from financing activities 2
17 121
14 244
6 690
Net changes in cash and bank deposits
1 152
1 233
252
Holdings of cash and bank deposits at start of period
3 762
3 509
3 509
Holdings of cash and bank deposits at end of period
4 914
4 742
3 762
1 Payments on the purchase of tangible fixed assets.
2 Net receipts of owners’ equity contribution, rising og new loans and repayment of debt, and payments from unit holders in consolidated security funds.
Notes to the financial statementKLP Group
Note 1 Accounting principles –and estimates
Accounting principles
The financial statements in this interim report show the Kommunal Landspensjonskasse (KLP) group financial statements financial statements for the period 01.01.2025 – 30.06.2025. The accounts have not been audited.
The consolidated financial statements for KLP have been prepared in accordance with IFRS® accounting standards, as approved by the EU, with additions set out in the Norwegian Regulations on annual accounts for insurance companies. The part of the interim report that relates to the Group financial statements has been prepared in accordance with IAS 34 Interim financial Reporting.
All amounts are presented in NOK millions without decimals unless indicated otherwise.
No other changes have been made to the accounting principles that affect the interim financial statements as of 30.06.2025. Refer to the Group’s annual report for 2024 for a more detailed description of accounting principles.
The interim financial statements do not contain all the information required for complete annual financial statements, and this interim report should be read in conjunction with the annual financial statements for 2024. The annual report can be retrieved from www.klp.no.
Changes in IFRS® Accounting Standards
A new accounting standard for presentation and disclosures in financial statements, IFRS 18, has been published by the IASB in April 2024. This new standard will replace IAS 1 Presentation of Financial Statements. If endorsed by the EU, the standard will be effective for annual reporting periods beginning on or after 1 January 2027. KLP does not plan to early implement the standrad.
Accounting estimates
In preparing the interim financial statements, we have exercised discretion and used estimates and assumptions that affect the accounting figures. Actual figures may differ from the estimates used.
The measurement of insurance contracts under IFRS 17 uses a number of new parameters that are fraught with considerable uncertainty. The most important for the various business areas are:
Life insurance activities
All cash flows arising from the insurance contracts that are within the contract limit are included in the measurement of the insurance contract. Future cash flows are calculated using assumptions of future annual wage growth/adjustment derived from a projection of the NAM (Norwegian Aggregate Model). The model produces a macro projection of key economic variables year by year based on the economic situation at the measurement date.
The cash flow calculations use best estimates of mortality and disability.
The cash flows are discounted with an interest rate curve that takes account of the time value of money and any financial risk that is not included in the estimated cash flows. The interest rate curve is based on the EIOPA interest rate curve with an illiquidity mark-up.
The risk adjustment for non-financial risk is based on the risk appetite in the life insurance business and a 98 percent confidence level and amounts to 8.4 percent of the insurance liability in 2025.
Non-life insurance activities
The claims provisions are estimated from the company’s historical payment patterns.
The claims provisions are discounted with an interest rate curve that takes account of the time value of money and any financial risk that is not included in the estimated payments. The interest rate curve is based on the EIOPA interest rate curve with an illiquidity mark-up.
Insurance income under IFRS 17 corresponds to pro-rata premiums earned, adjusted for seasonal variations.
Seasonal variations are estimated from the historical variation in the company’s history of claims received through the year.
The risk adjustment is derived from the company’s risk appetite. The risk adjustment represents an addition to technical provisions so there is a 75 percent probability that they will be sufficient to cover all insurance obligations. The risk adjustment for non-financial risk is based on the risk appetite in the non-life insurance business and a 75 percent confidence level and amounts to 4.0 percent of the net insurance liability in 2025.
Note 2 Segment information
NOK MILLIONS
Group pensions pub. sect. & group life
Non-life insurance
Banking
Asset management
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
Result from insurance services
0
0
0
67
-66
88
0
0
0
0
0
0
Premium income for own account
42 711
37 257
60 883
0
0
0
0
0
0
0
0
0
Net financial income from investments
24 756
33 573
65 570
179
171
380
271
255
520
19
16
29
Claims for own account
-18 422
-16 132
-30 200
0
0
0
0
0
0
0
0
0
Insurance provisions for own account
-47 999
-53 661
-94 146
0
0
0
0
0
0
0
0
0
Policyholder's share of changes in fair value of underlying items
0
0
0
0
0
0
0
0
0
0
0
0
Other insurance related financial cost
0
0
0
-55
-43
-84
0
0
0
0
0
0
Unit holder's value change in consolidated security funds
0
0
0
0
0
0
0
0
0
0
0
0
Net insurance services and financial result
1 046
1 038
2 107
192
63
384
271
255
520
19
16
29
Net financial income from investments in companys portefolio
995
713
2 143
0
0
0
0
0
0
0
0
0
Net costs subordinated loan and hybrid Tier 1 securities
3
-90
-382
0
0
0
0
0
0
0
0
0
Operating expenses
-877
-793
-1 693
0
0
0
-144
-140
-284
-277
-260
-520
Other income and expenses
-1
-18
-6
0
1
2
57
52
89
282
298
593
Pre-tax income
1 167
850
2 169
193
64
386
184
167
325
24
53
103
Cost of taxes
-212
-172
-356
-48
-16
-61
-6
-6
-10
-6
-13
-24
Income
955
678
1 812
144
48
325
179
161
315
18
40
79
Total other comprehensive income
-92
247
329
-10
27
36
-4
12
17
-11
27
31
Total comprehensive income
863
926
2 142
134
75
361
174
173
332
7
67
110
Lending
106 185
309 773
106 343
0
0
0
45 988
44 646
44 033
0
0
0
Other assets
803 486
526 653
757 603
7 682
7 111
6 712
5 146
5 326
7 770
692
683
775
Total assets
909 670
836 426
863 946
7 682
7 111
6 712
51 134
49 973
51 803
692
683
775
Insurance liabilites
847 325
778 458
803 036
4 089
3 941
3 294
0
0
0
0
0
0
Other liabilities
14 346
13 220
13 675
505
501
464
47 597
46 693
48 364
192
195
282
Total liabilities
861 672
791 678
816 712
4 594
4 441
3 757
47 597
46 693
48 364
192
195
282
NOK MILLIONS
Other and eliminiations
Total
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
Result from insurance services
-59
63
-1 708
9
-2
-1 620
Premium income for own account
-42 711
-37 257
-60 883
0
0
0
Net financial income from investments
10 415
21 467
38 387
35 641
55 482
104 886
Claims for own account
18 422
16 132
30 200
0
0
0
Insurance provisions for own account
47 999
53 661
94 146
0
0
0
Policyholder's share of changes in fair value of underlying items
-29 646
-32 144
-63 663
-29 646
-32 144
-63 663
Other insurance related financial cost
0
0
0
-55
-43
-84
Unit holder's value change in consolidated security funds
-4 013
-21 785
-38 287
-4 013
-21 785
-38 287
Net insurance services and financial result
408
137
-1 809
1 936
1 508
1 232
Net financial income from investments in companys portefolio
-995
-713
-2 143
0
0
0
Net costs subordinated loan and hybrid Tier 1 securities
35
-44
-69
38
-133
-451
Operating expenses
868
803
1 689
-430
-391
-808
Other income and expenses
-403
-375
-711
-64
-42
-34
Pre-tax income
-88
-192
-3 043
1 480
942
-60
Cost of taxes
-586
-556
-1 182
-857
-763
-1 634
Income
-673
-747
-4 225
623
179
-1 694
Total other comprehensive income
543
91
1 118
425
405
1 531
Total comprehensive income
-131
-656
-3 107
1 048
584
-163
Lending
-20 097
-227 558
-20 449
132 075
126 861
129 927
Other assets
245 755
412 647
244 603
1 062 761
952 420
1 017 462
Total assets
225 658
185 089
224 154
1 194 837
1 079 281
1 147 389
Insurance liabilites
14 917
14 002
33 283
866 331
796 401
839 613
Other liabilities
268 120
224 828
248 295
330 760
285 436
311 080
Total liabilities
283 037
238 830
281 578
1 197 092
1 081 837
1 150 693
The KLP Group’s business is divided into the five areas: Group pensions public sector & group life, non-life insurance, banking, asset management and other. All business is directed towards customers in Norway.
PUBLIC SECTOR OCCUPATIONAL PENSION AND GROUP LIFE
Kommunal Landspensjonskasse offers group public sector occupational pensions. This segment is followed up according to NGAAP, which deviates from the IFRS Accounting Standards used in the group. Adjustments have therefore been entered in the elimination column to make the total reconcileable to the consolidated accounts.
NON-LIFE INSURANCE
KLP Skadeforsikring AS offers property and personal injury products to employers within the public and private sectors. In addition, a broad specter of standard insurance products is offered to the the retail market.
BANKING
KLP’s banking business embraces the companies KLP Banken AS and its wholly-owned subsidiaries: KLP Kommunekreditt AS and KLP Boligkreditt AS. The banking business covers services such as deposits and lending to the retail market, credit cards, as well as lending with public sector guarantee.
ASSET MANAGEMENT
Asset management is offered from the company KLP Kapitalforvaltning AS. The company offers a broad selection of securities mutual funds both to retail customers and to institutional customers. The securities management has a socially responsible profile.
OTHER
Other segments comprise KLP Forsikringsservice AS which offers a broad specter of services to local authority pension funds.
Note 3 Insurance service result
NOK MILLIONS
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
Insurance income
794
1 008
2 372
2 242
2 788
Insurance service expenses
-1 069
-872
-2 266
-2 112
-4 230
Reinsurance income (+)/ cost (-)
-29
-27
-98
-133
-178
Insurance service result
-304
109
9
-2
-1 620
Note 4 Investment property
NOK MILLIONS
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
Net rental income
1 176
1 094
2 377
2 121
4 314
Net value adjustment
1 545
353
1 873
-646
697
Net income from investment properties
2 720
1 446
4 250
1 475
5 011
Translation difference foreign exchange (taken to other comprehensive income)
672
-537
514
115
1 124
Net income from investment properties translation difference foreign exchange
3 392
910
4 764
1 590
6 135
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Investment property 01.01.
98 889
92 322
92 322
Value adjustment, including translation difference foreign exchange
2 387
- 531
1 821
Net additions
4 280
3 726
4 749
Reclassification property for own use
- 1 231
- 6
- 5
Other changes
- 14
17
2
Book value
104 311
95 529
98 889
Note 5 Technical provisions
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Life insurance contracts
862 242
792 460
836 319
Non-life insurance contracts
4 089
3 941
3 294
Insurance obligations
866 331
796 401
839 613
NOK MILLIONS
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Residual value
Total
Life insurance contracts 1 January 2025
411 318
29 181
395 820
836 319
Changes that realte to current services
Change in risk adjustment for non-financial risk for risk expired
0
93
0
93
Experience adjustment not related to future service
-34
0
0
-34
Insurance service result
-34
93
0
59
Change in risk adjustment for non-financial risk at the start of the period
0
0
0
0
Accured interest
8 208
690
-8 898
0
Released cash flows
1 390
0
0
1 390
Changes in estimates related to future service
11
1
-12
0
Change due to changes in discount curve
-9 682
-813
10 495
0
Result addes to policyholders
747
0
27 509
28 256
Insurance related financial cost
673
-123
29 095
29 646
Premium
15 177
0
0
15 177
Claims and other insurance service expenses (incl. Investmentcomponents)
-18 958
0
0
-18 958
Total cash flows
-3 781
0
0
-3 781
Life insurance contracts 30 June 2025
408 175
29 151
424 916
862 242
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Non-life insurance contracts 1 January 2025
2 808
121
364
3 294
Insurance income
0
0
-1 532
-1 532
Claims
1 055
42
0
1 097
Expenses
314
3
0
317
Other movements realted to current service
0
-17
0
-17
Changes that relate to past service
-7
-24
0
-30
Insurance service expenses
1 362
5
0
1 367
Insurance service result
1 362
5
-1 532
-165
Insurance related financial cost
65
-2
0
63
Premium
0
0
2 238
2 238
Claims and other insurance service expenses
-1 297
0
0
-1 297
Total cash flows
-1 297
0
2 238
940
Other changes
4
0
-47
-43
Non-life insurance contracts 30 June 2025
2 942
124
1 023
4 089
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Reinsurance contracts assets 1 January 2025
494
18
-3
510
Premium paid - reinsurance
0
0
-80
-80
Recoveries of incurred claims and other insurance service expenses
0
0
0
0
Reinsurance expenses -related to past service
-17
-2
0
-18
Insurance service expenses
-17
-2
0
-18
Insurance service result
-17
-2
-80
-98
Insurance related financial cost
7
1
0
9
Premium
-22
0
61
39
Total cash flows
-22
0
61
39
Other changes
-152
0
0
-152
Reinsurance contracts assets 30 June 2025
311
18
-22
307
NOK MILLIONS
Life insurance contracts
Non-life insurance contracts
Reinsurance
Total
Specification of profit or loss items per product group 01.01.-30.06.2025
Insurance service result
-59
165
-98
9
Net insurance related financial cost
-29 646
-63
9
-29 700
NOK MILLIONS
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Residual value
Total
Life insurance contracts 1 January 2024
377 742
29 068
355 979
762 789
Changes that realte to current services
Change in risk adjustment for non-financial risk for risk expired
0
-20
0
-20
Experience adjustment not related to future service
-43
0
0
-43
Insurance service result
-43
-20
0
-63
Change in risk adjustment for non-financial risk at the start of the period
0
-924
924
0
Accured interest
7 999
672
-8 671
0
Released cash flows
21
0
0
21
Changes in estimates related to future service
-4 240
-356
4 596
0
Change due to changes in discount curve
-13 404
-1 126
14 531
0
Result addes to policyholders' residual value
1 564
0
30 560
32 124
Insurance related financial cost
-8 061
-1 734
41 940
32 144
Premium
13 952
0
0
13 952
Claims and other insurance service expenses (incl. Investmentcomponents)
-16 361
0
0
-16 361
Total cash flows
-2 410
0
0
-2 410
Life insurance contracts 30 June 2024
367 228
27 313
397 919
792 460
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Non-life insurance contracts 1 January 2024
2 944
128
320
3 392
Insurance income
0
0
-1 365
-1 365
Claims
1 155
47
0
1 202
Expenses
274
3
0
277
Other movements realted to current service
0
-17
0
-17
Changes that relate to past service
-131
-32
0
-163
Insurance service expenses
1 298
1
0
1 298
Insurance service result
1 298
1
-1 365
-67
Insurance related financial cost
53
-2
0
52
Premium
0
0
1 966
1 966
Claims and other insurance service expenses
-1 359
0
0
-1 359
Total cash flows
-1 359
0
1 966
607
Other changes
0
0
-42
-42
Non-life insurance contracts 30 June 2024
2 936
127
878
3 941
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Reinsurance contracts assets 1 January 2024
699
39
-10
728
Premium paid - reinsurance
0
0
-67
-67
Recoveries of incurred claims and other insurance service expenses
0
0
0
0
Reinsurance expenses -related to past service
-55
-11
0
-66
Insurance service expenses
-55
-11
0
-66
Insurance service result
-55
-11
-67
-133
Insurance related financial cost
10
-2
0
9
Premium
-154
0
80
-75
Total cash flows
-154
0
80
-75
Other changes
9
0
0
9
Reinsurance contracts assets 30 June 2024
508
27
3
538
NOK MILLIONS
Life insurance contracts
Non-life insurance contracts
Reinsurance
Total
Specification of profit or loss items per product group 01.01-30.06.2024
Insurance service result
63
67
-133
-2
Insurance related financial cost
-32 144
-52
9
-32 187
NOK MILLIONS
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Residual value
Total
Life insurance contracts 1 January 2024
377 742
29 068
355 979
762 789
Changes that realte to current services
Change in risk adjustment for non-financial risk for risk expired
0
1 782
0
1 782
Experience adjustment not related to future service
-73
0
0
-73
Insurance service result
-73
1 782
0
1 708
Change in risk adjustment for non-financial risk at the start of the period
0
-924
924
0
Accured interest
16 492
1 386
-17 878
0
Released cash flows
-4 983
0
0
-4 983
Changes in estimates related to future service
3 076
258
-3 335
0
Change due to changes in discount curve
-28 425
-2 388
30 813
0
Result addes to policyholders' residual value
39 330
0
29 316
68 645
Insurance related financial cost
25 490
-1 668
39 841
63 663
Premium
38 869
0
0
38 869
Claims and other insurance service expenses (incl. Investmentcomponents)
-30 710
0
0
-30 710
Total cash flows
8 159
0
0
8 159
Life insurance contracts 31 December 2024
411 318
29 181
395 820
836 319
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Non-life insurance contracts 1 January 2024
2 944
128
320
3 392
Insurance income
0
0
-2 758
-2 758
Claims
2 098
84
0
2 182
Expenses
535
7
0
541
Other movements realted to current service
0
-45
0
-45
Changes that relate to past service
-136
-51
0
-187
Insurance service expenses
2 497
-5
0
2 492
Insurance service result
2 497
-5
-2 758
-266
Insurance related financial cost
103
-1
0
101
Premium
0
0
2 777
2 777
Claims and other insurance service expenses
-2 741
0
0
-2 741
Total cash flows
-2 741
0
2 777
36
Other changes
5
0
26
32
Non-life insurance contracts 31 December 2024
2 808
121
364
3 294
NOK MILLIONS
Liability for incurred claims (LIC)
Liabilities for remaining coverage
Total
Estimates of present value of future cash flows
Risk adjustment for non financial risk
Reinsurance contracts assets 1 January 2024
699
39
-10
728
Premium paid - reinsurance
0
0
-136
-136
Recoveries of incurred claims and other insurance service expenses
0
0
0
0
Reinsurance expenses -related to past service
-23
-19
0
-42
Insurance service expenses
-23
-19
0
-42
Insurance service result
-23
-19
-136
-178
Insurance related financial cost
19
-1
0
17
Premium
-342
0
143
-199
Total cash flows
-342
0
143
-199
Other changes
141
0
0
141
Reinsurance contracts assets 31 December 2024
494
18
-3
510
NOK MILLIONS
Life insurance contracts
Non-life insurance contracts
Reinsurance
Total
Specification of profit or loss items per product group 01.01. - 31.12.2024
Insurance service result
-1 708
266
-178
-1 620
Insurance related financial cost
-63 663
-101
17
-63 747
IMPORTANT ASSUMPTIONS
Discount curve for IFRS 17
Expected cash flows from the insurance contracts will mature at various times in the future. The future cash flows are therefore discounted to the value on the balance sheet date with an interest rate curve that is determined on the balance sheet date. The discount curve for IFRS 17 is generally determined according to the same principles as the curve EIOPA calculates for Solvency II purposes. The main difference is that EIOPA's estimate for volatility adjustment is replaced with an estimate for the illiquidity spread in the bond market, and this is calibrated to the illiquidity degree of the KLP's obligation. Selected values of discounting curves for IFRS 17 are listed below:
Year
30.06.2025
30.06.2024
31.12.2024
1
4,7 %
5,1 %
4,8 %
2
4,6 %
5,0 %
4,7 %
3
4,5 %
4,8 %
4,6 %
4
4,4 %
4,6 %
4,6 %
5
4,3 %
4,5 %
4,5 %
10
4,4 %
4,3 %
4,4 %
15
4,3 %
4,2 %
4,3 %
25
4,2 %
4,0 %
4,1 %
50
3,9 %
3,8 %
3,8 %
75
3,8 %
3,7 %
3,7 %
100
3,7 %
3,6 %
3,7 %
Salary growth curve
Future cash flows within the contract boundary are calculated with assumptions about annual future salary growth/regulation as stated in the table below. The salary growth curve is projected by the NAM model (Norwegian aggregate model), which makes a macro projection of key economic figures (salary growth, inflation, etc.) year by year.
Year
30.06.2025
30.06.2024
31.12.2024
1
5,2 %
4,3 %
4,6 %
5
4,4 %
4,1 %
4,3 %
10
3,3 %
3,7 %
3,7 %
15
3,2 %
3,5 %
3,3 %
25
3,5 %
3,5 %
3,5 %
50
3,5 %
3,4 %
3,5 %
80
3,5 %
3,4 %
3,5 %
SENSITIVITY IFRS 17
The table below shows the consequence for the group's residual value of a change in the standard assumptions used in the best estimate. Sensitivity related to costs is also included in the overview. The residual value consists of the part of the insurance liability that is not included in the best estimate or the risk adjustment.
NOK MILLIONER
Change
30.06.2025
30.06.2024
31.12.2024
Reduced mortality
-5 %
-4 670
-4 375
-4 674
Increased mortality
5 %
4 472
4 191
4 477
Increased disability
5 %
-415
-388
-414
Reduced disability
-5 %
417
391
418
Increased costs
5 %
-1 346
-1 261
-1 347
Reduced costs
-5 %
1 345
1 261
1 348
Increased yield curve
*)
34 880
32 536
35 002
Reduced yield curve
**)
-39 245
-39 298
-40 015
All changes to assumptions are in % change of the standard assumption applied as of 30.06.2025 (30.06.2024/31.12.2024).
*) Increased interest rate curve by 50 basis points for the liquid part of the discount rate curve, 1:10 years. Then extrapolated to an estimate for long-term interest based on the sum of long-term real GDP growth and Norges Bank's inflation target.
**) Reduced by 50 basis points for the liquid part of the discount rate curve, 1:10 years. Then extrapolated to an estimate for long-term interest based on the sum of long-term real GDP growth and Norges Bank's inflation target.
Note 6 Subordinated loans and perpetual hybrid tier 1 securities
NOK MILLIONS
Q2 2025
Q2 2024
01.01.2025 -30.06.2025
01.01.2024 -30.06.2024
01.01.2024 -31.12.2024
SUBORDINATED LOANS
Interest costs
-67
-32
-99
-72
-146
Value changes
-70
65
53
-101
-229
Net costs subordinated loans
-137
33
-47
-173
-375
PERPETUAL HYBRID TIER 1 SECURITIES
Interest costs
-17
-18
-36
-38
-80
Value changes
46
113
121
78
5
Net costs perpetual hybrid tier 1 securities
28
95
84
39
-75
Net costs subordinated loan and hybrid Tier 1 securities
-109
128
38
-133
-451
This note gives a specification of the line "Net costs subordinated loan and hybrid Tier 1 securities" in the income statement. The fluctuations in value change are predominantly due to the loans being denominated in foreign currency. The subordinated loan is issued in euros and the perpetual hybrid Tier 1 security are issued in Japanese yen.
Note 7 Fair value of financial assets and liabilites
Fair value is to be a representative price based on what the equivalent assets or liabilites would be sold for under normal market terms and conditions. A financial instrument is considered as being listed in an active market if listed prices are easily and regularly accessible from a stock exchange, dealer, broker, commercial group, pricing service or regulatory authority, and such prices represent actual transactions that occur regularly at arm’s length. If the market for the security is not active, or the security is not listed on a stock exchange or similar, the Group uses valuation techniques to determine fair value. These are based on information on transactions recently carried out on business conditions, reference to the purchase and sale of similar instruments and pricing by means of externally obtained interest-rate curves and interest-rate differential curves. Estimates are based to the greatest possible extent on external observable market data, and to a small degree on company-specific information.
In the case of this note, there are three different categories of financial instruments: balance sheet classification, accounts classification, and type of instrument. It is for this last category that information is provided about how fair value is derived.
FINANCIAL INSTRUMENTS MEASURED AT AMORTISED COST
This category includes:
Fixed-income securities and other debt instruments measured at amortised cost
Lending to local government, enterprises & retail customers measured at amortised cost
Liabilites to and deposits from customers
Other debt issued (liabilities)
Financial instruments not measured at fair value are measured at amortised cost by using the effective interest rate method. The internal rate of exchange is determined by discounting contractual cash flows over their expected term. The cash flows include arrangement/up-front fees and direct transaction costs as well as any residual value on the expiry of the expected term. Amortised cost is the present value of these cash flows discounted by the internal rate of interest. This note contains information about the fair value of the financial instruments that are measured at amortised cost.
FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE
This category includes:
Shares and units
Fixed-income securities and other debt instruments measured at fair value
Lending local government, enterprises & retail customers at fair value through profit/loss
Derivatives (assets and liabilites)
Debt to credit institutions (liabilites)
Subordinated loan capital (liabilities)
Below is a list of which types of financial instrument come under the various accounts categories, and how fair value is calculated.
FIXED-INCOME SECURITIES AND OTHER DEBT INSTRUMENTS MEASURED AT FAIR VALUE
a) Foreign fixed-income securities
Foreign fixed-income securities are generally priced based on prices obtained from an index provider. At the same time, prices are compared between several different sources to spot any errors.
The following sources are used:
Bloomberg Barcalys Indicies
Bloomberg
Barclays Capital Indices have first priority (they cover foreign government and foreign credit respecitvely). Then comes Bloomberg based on Bloomberg’s pricing service Business Valuator Accredited in Litigation (BVAL). BVAL has verified prices from Bloomberg.
b) Norwegian fixed-income securities – government
Nordic Bond Pricing is used as the primary source for pricing Norwegian Government Bonds.
c) Norwegian fixed-income securities – other than government ones
Norwegian fixed-income securities – other than government ones Norwegian fixed-income securities (denominated in NOK) are generally priced based on rates from Nordic Bond Pricing. Securities not covered by Nordic Bond Pricing are priced theoretically. The theoretical price should be based on the discounted value of the security's future cash flows. Discounting is performed using a swap curve adjusted for credit spread and liquidity spread. The credit spread should, to the extent possible, be based on a comparable bond from the same issuer. The liquidity spread is determined at the discretion of the evaluator.
d) Fixed-income securities issued by foreign enterprises but denominated in NOK
Fair value is calculated on the same general principles as those applied on Norwegian fixed-income securities described above.
e) Receivables on credit institutions
The fair value of these are considered as being approximately the same as the book value since the terms and conditions of the contract are continually revised in accordance with changes in the market rates.
f) Loans to municipalities and enterprises with municipal guarantee
Receivables are valued by means of a valuation model using relevant credit premium adjustments obtained in the market. For guaranteed loans fair value is calculated as discounted cash flow based on the same interest-rate curves as direct loans, but the credit margin is adjusted to market values for the appropriate combination of guarantee category and type of guarantee. The guarantor is either a state, municipality or a bank.
g) Loans secured by mortgage
The principles for calculating fair value are subject to the loans having fixed-interest rates or not. Fair value of fixed-rate loans is calculated by discounting contractual cash flows by the market rate including a relevant risk margin on the reporting date. The fair value of loans with no fixed rate is approximately equal to book value since the terms and conditions of the contract are continually revised in accordance with changes in the market rates.
SHARES AND UNITS
h) Shares (listed)
Liquid shares are generally valued on the basis of prices from an index provider. At the same time, prices are compared between different sources in order to spot any errors.
The following sources are used for Norwegian shares:
Oslo Børs/Oslo Stock Exchange (primary source)
Morgan Stanley Capital International (MSCI)
Bloomberg
The following sources are used for foreign shares:
Morgan Stanley Capital International (MSCI) (primary source)
Bloomberg
i) Shares (unlisted)
As far as possible, The Group uses the Norwegian Mutual Funds Association’s industry recommendations. This basically means the following:
This means that the last traded price is used as long as it is considered representative. If the price information is deemed outdated, a derived valuation is performed in relation to a relevant proxy (such as a stock index or one or more companies). If this is not possible, a discretionary assessment is made, which may be based on fundamental analysis, broker evaluations, or risk and liquidity adjustments to the price.
j) Private Equity
Most of the investment in Private Equity goes through funds. The funds’ fair value is to be based on reported market values that follow from the International Private Equity and Venture Capital Valuation Guidelines (’IPEV Guidelines). These guidelines are established by the European Venture Capital Association (EVCA) and are based on the principle of approximate market assessment of the companies. Fair value is calculated on the basis of the funds’ reported market value adjusted for payments in and out during the period between the fund’s last reported market value and the period being reported on for the Group. Direct investments in Private Equity are treated in the same way as with current stocks, but valuation can be daily, quarterly or yearly. In cases where it's possible to obtain information on what co-investments are priced within the funds, it will be considered in the valuation process. Other direct investments are valued based on either cost prices, reported market values from companies or available trading prices.
DERIVATIVES
k) Futures/FRA/IRF
All futures contracts for KLP are traded on the stock exchange. Bloomberg is used as a price source. Prices are also obtained from another source in order to check that Bloombergs’ prices are correct. Reuters acts as a secondary source.
l) Options
Bloomberg is used as a source for pricing options traded on the stockmarket. Reuters is a secondary source.
m) Interest-rate swaps
Interest-rate swaps are valued in a model that takes observable market data such as interest-rate curves and relevant credit premiums into account.
n) FX-swaps
FX-swaps with a one-year maturity or less are priced on curves that are built up from FX swap-points obtained from Reuters. The market is not considered particularly liquid for FX-swaps with a maturity of more than one year and basis-adjusted swap curves are used for pricing purposes.
DEBT TO CREDIT INSTITUTIONS
o) Placements with credit institutions and deposits
Placements with credit institutions are made as short-term deposits. Fair value is calculated by discounting contractual cash flows by market rate including a relevant risk margin on the reporting date. Deposits are prices on swap curves.
SUBORDINATED LOAN CAPITAL, OTHER DEBT ISSUED, AND DEPOSITS FROM CUSTOMERS
p) Fair value of subordinated loans
As these are loans that are not part of an active market, fair value is calculated based on observable data in an internal valuation model.
q) Fair value of subordinated bond/perpetual bond issued
Fair value in this category is determined on the basis of internal valuation models based on external observable data.
r) Covered bonds issued
Fair value in this category is determined on the basis of internal valuation models based on observable data.
s) Deposits from customers
All deposits are without fixed-rate interest. The fair value of these is considered as approximately equal to book value since the contractual terms are continually revised in accordance with the market rate.
The tables below give a more detailed specification of the content of the different classes of assets and financial liabilities.
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Book value
Fair value
Book value
Fair value
Book value
Fair value
FIXED-INCOME SECURITIES AND OTHER DEBT INSTRUMENTS AT AMORTISED COST
Norwegian bonds
1 070
1 046
1 058
1 018
1 102
1 052
Foreign bonds
1 305
1 266
1 236
1 166
1 232
1 166
Fixed-income securities and other debt instruments at amortised cost
2 375
2 312
2 294
2 184
2 334
2 219
LENDING LOCAL GOVERNMENT, ENTERPRISES & RETAIL CUSTOMERS AT FAIR VALUE THROUGH PROFIT/LOSS
Loans secured by mortgage
3 164
3 164
2 474
2 474
3 197
3 197
Loans to local government sector or enterprises with local government guarantee
77 405
77 405
74 736
74 736
76 844
76 844
Loans abroad secured by mortage and local government guarantee
5 608
5 608
6 181
6 181
6 311
6 311
Other lending
1 695
1 695
667
667
740
740
Total loans to local government, enterprises & retail customers at fair value
87 872
87 872
84 057
84 057
87 092
87 092
LENDING TO LOCAL GOVERNMENT, ENTERPRISES & RETAIL CUSTOMERS – AT AMORTISED COST
Loans to and receivables from customers
44 204
44 204
42 804
42 817
42 836
42 851
Total loans to local government, enterprises & retail customers at amortised cost
44 204
44 204
42 804
42 817
42 836
42 851
FIXED-INCOME SECURITIES AT FAIR VALUE
Norwegian bonds
148 173
148 173
129 675
129 675
137 843
137 843
Norwegian certificates
14 820
14 820
13 679
13 679
12 361
12 361
Foreign bonds
213 379
213 379
213 997
213 997
215 443
215 443
Foreign certificates
0
0
700
700
0
0
Investments with credit institutions
53 190
53 190
46 558
46 558
53 431
53 431
Fixed income securitites at fair value
429 562
429 562
404 610
404 610
419 077
419 077
SHARES AND UNITS AT FAIR VALUE THROUGH PROFIT OR LOSS
Shares
421 905
421 905
362 801
362 801
410 894
410 894
Equity funds
54 478
54 478
48 741
48 741
53 887
53 887
Property funds
9 296
9 296
7 566
7 566
8 040
8 040
Total shares and units at fair value
491 649
491 649
421 518
421 518
477 165
477 165
RECEIVABLES
Receivables related to direct business
1 074
1 074
862
862
1 383
1 383
Receivables related to reinsurance agreements
0
0
0
0
0
0
Reinsurance share of gross claims reserve
0
0
0
0
0
0
Receivables related to securites
12 349
12 349
8 177
8 177
1 797
1 797
Prepaid rent related to real estate activites
344
344
360
360
348
348
Other receivables
122
122
165
165
7
7
Total other loans and receivables including receivables from policyholders
13 890
13 890
9 564
9 564
3 534
3 534
FINANCIAL LIABILITIES
Debt to credit institutions
6 570
6 570
3 286
3 286
1 395
1 395
Covered bonds issued
29 357
29 473
29 986
30 084
31 529
31 596
Liabilities and deposits from customers
17 151
17 151
15 629
15 629
15 801
15 801
Hybrid Tier 1 securities
1 308
1 308
1 356
1 356
1 429
1 429
Subordinated loan capital
0
0
3 358
3 358
3 560
3 560
Total financial liabilities
54 386
54 502
53 615
53 712
53 713
53 781
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Assets
Liabilities
Assets
Liabilities
Assets
Liabilities
FINANCIAL DERIVATIVES - AT FAIR VALUE THROUGH PROFIT OR LOSS
Forward exchange contracts
3 659
2 229
2 654
579
781
7 070
Interest rate swaps
480
2 208
620
2 639
243
4 235
Interest rate and currency swaps
608
0
491
0
445
0
Total financial derivatives
4 747
4 436
3 766
3 218
1 469
11 304
Note 8 Borrowing
NOK MILLIONS
Nominal in NOK
Currency
Interest
Due date
Book value 30.06.2025
Book value 30.06.2024
Book value 31.12.2024
FIXED - TERM SUBORDINATED LOAN
Kommunal Landspensjonskasse
2 530
EUR
Fixed ¹
2045
0
3 358
3 560
Total subordinated loan capital
2 530
0
3 358
3 560
HYBRID TIER 1 SECURITIES
Kommunal Landspensjonskasse
984
JPY
Fixed ²
2034
1 308
1 356
1 429
Total hybrid Tier 1 securities
984
1 308
1 356
1 429
COVERED BONDS
KLP Kommunekreditt AS
0
NOK
Floating
2025
0
3 009
1 892
KLP Kommunekreditt AS
5 000
NOK
Floating
2026
5 051
5 053
5 053
KLP Kommunekreditt AS
1 000
NOK
Fixed
2027
1 017
1 017
1 012
KLP Kommunekreditt AS
6 000
NOK
Floating
2027
6 049
6 052
6 050
KLP Kommunekreditt AS
6 250
NOK
Floating
2028
6 304
3 027
6 306
KLP Kommunekreditt AS
700
NOK
Fixed
2029
722
722
706
KLP Boligkreditt AS
0
NOK
Floating
2024
0
599
0
KLP Boligkreditt AS
170
NOK
Floating
2025
170
2 501
2 501
KLP Boligkreditt AS
4 500
NOK
Floating
2026
4 533
4 533
4 535
KLP Boligkreditt AS
2 500
NOK
Floating
2027
2 516
2 516
2 516
KLP Boligkreditt AS
3 000
NOK
Floating
2028
3 008
1 003
1 003
Other
-13
-45
-45
Total covered bonds
29 120
29 357
29 986
31 529
DEBT TO CREDIT INSTITUTIONS
KLP Banken AS
0
NOK
Floating
2024
0
127
0
KLP Banken AS
300
NOK
Floating
2025
301
301
301
KLP Banken AS
150
NOK
Floating
2026
151
151
151
KLP Banken AS
350
NOK
Floating
2027
353
202
353
KLP Fond
2 338
NOK/EUR/USD
Fixed
2025
2 338
147
0
KLP Fond
1 073
NOK/EUR/USD
Floating
2025
1 073
487
30
Kommunal Landspensjonskasse
2 291
NOK/EUR/USD
Floating
2025
2 291
1 784
512
Other
62
87
47
Total liabilities to credit institutions
6 503
6 570
3 286
1 395
LIABILITIES AND DEPOSITS FROM CUSTOMERS ³
KLP Banken AS
17 151
NOK
17 151
15 629
15 801
Liabilities to and deposits from customers
17 151
17 151
15 629
15 801
Total financial liabilities
56 287
54 386
53 615
53 713
1 The loan has been settled in 2025.
2 The loan has an interest change date in 2034.
3 There is no contractual maturity date on deposits.
This note shows the financial liabilities that the Group had at the end of the reporting period, where the majority is funding for KLP Bank Group. The companies listed above are the issuers of the financial debt. Deposits belongs to KLP Banken AS.
Note 9 Fair value hierarchy
NOK MILLIONS
Level 1
Level 2
Level 3
30.06.2025
30.06.2024
31.12.2024
ASSETS BOOKED AT FAIR VALUE
Land/plots
0
0
1 283
1 283
1 283
1 283
Buildings
0
0
103 029
103 029
94 247
97 606
Investment property
0
0
104 311
104 311
95 529
98 889
Lending at fair value
0
87 872
0
87 872
84 057
87 092
Certificates
3 654
11 166
0
14 820
14 380
12 361
Bonds
21 133
340 393
0
361 526
343 845
353 274
Fixed-income funds
0
9 892
17 007
26 899
25 276
26 782
Loans and receivables
25 514
803
0
26 316
21 110
26 661
Bonds and other fixed-income securities
50 301
362 253
17 007
429 562
404 610
419 077
Shares
408 878
6 682
6 345
421 905
362 801
410 894
Equity funds
3 026
0
33
3 059
2 745
2 952
Property funds
0
2 691
6 605
9 296
7 566
8 040
Special funds
0
4 229
1 742
5 971
11 942
4 345
Private Equity
0
0
51 419
51 419
45 995
50 936
Shares and units
411 903
13 602
66 144
491 649
421 518
477 165
Financial derivatives
0
4 747
0
4 747
3 766
1 469
Total assets at fair value
462 205
468 474
187 462
1 118 141
1 009 480
1 083 691
LIABILITIES BOOKED AT FAIR VALUE
Financial derivatives
0
4 436
0
4 436
3 218
11 304
Debt to credit institutions ¹
3 431
2 338
0
5 770
2 506
590
Subordinated loan capital
0
0
0
0
3 358
3 560
Hybrid Tier 1 securities
0
1 308
0
1 308
1 356
1 429
Total financial liabilities at fair value
3 431
8 083
0
11 514
10 437
16 884
¹ The line «Debt to credit institutions» includes liabilities measured at fair value and amortized cost. This line is therefore not reconcilable against the Balance sheet. The liabilities measured at amortized cost amounted to NOK 800 million per 30.06.2025.
Changes in level 3, financial assets and investment property
Financial assets
Investment property
Total
Opening balance 1 January
82 530
98 889
181 418
Sold
-2 797
-1 231
-4 028
Bought
3 819
4 280
8 099
Unrealised changes
-401
2 387
1 986
Other changes
0
-14
-14
Closing balance
83 151
104 311
187 462
Realised gains/losses
1 079
0
1 079
Unrealised changes and realized gains/losses are reflected on the line "Net value changes on financial instruments" in the consolidated income statement.
The table "Changes in level 3" shows changes in level 3 classified instruments in the period indicated.
Fair value shall be a representative price based on what a corresponding asset or liability would have been traded for on normal market terms and conditions. Highest quality in regard to fair value is based on listed prices in an active market. A financial instrument is considered as noted in an active market if noted prices are easily and regularly available from a stock market, dealer, broker, industry grouping, price setting service or regulatory authority, and these prices represent actual and regularly occurring transactions at arm’s length.
Level 1:
Instruments at this level obtain fair value from listed prices in an active market for identical assets or liabilities that the entity has access to at the reporting date. Examples of instruments at Level 1 are stock market listed securities.
Level 2:
Instruments at this level obtain fair value from observable market data. This includes prices based on identical instruments, but where the instrument does not maintain a high enough trading frequency and is corresponding therefore not considered to be traded in an active market, as well as prices based on assets and price-leading indicators that can be confirmed from market information. Example instruments at Level 2 are fixed income securities priced on the basis of interest rate paths.
Level 3:
Instruments at Level 3 contain no observable market data or are traded in markets considered to be inactive. The price is based generally on discrete calculations where the actual fair value may deviate if the instrument were to be traded. The instruments covered at Level 3 in the Group include unlisted shares and Private Equity.
Valuations related to items in the various levels are described in Note 7. For description of the pricing of investment property, please see the last published annual financial statements. All Investment properties are included in level 3.
For level 3 securities, a change in MSCI Europe index of +/- 10 percent will result in a change in value of +/- NOK 1 035 million for shares and funds units, +/- NOK 7 713 million in private equity and +/- NOK 680 million in fixed-income funds. For sensitivity analysis of investment property, please refer to published annual report.
With regard to transferring securities between the levels, a limit is set for the number of trading days and the amount of trading for shares by separating Level 1 and Level 2. The general principles related to the distribution between levels basically concern whether the asset or liability is listed or not and whether the listing can be stated to be in an active market. As regards shares, there is a further distinction between trading days and amount of trading which separates out listed securities that do not form part of an active market. The values at the end of the reporting period provide the basis for any movement between the levels.
During the 2nd quarter, NOK 754 million in stocks moved from Level 1 to Level 2, and NOK 244 million moved from level 1 to level 3. In addition NOK 419 million in stocks moved from level 2 to level 1, and NOK 17 million from level 2 to level 3. The movements are due to changes in liquidity.
Note 10 Presentation of assets and liabilities that are subject to net settlement
30.06.2025 NOK MILLIONS
Related amounts not presented net
Gross financial assets/ liabilities
Financial instruments
Security in cash
Security in securities
Net amount
Adjusted for the unit holders' interest in consolidated securities funds
ASSETS
Financial derivatives
4 747
-2 747
-3 346
-7 020
101
87
Repos
4 784
0
0
0
4 784
4 784
Total
9 532
-2 747
-3 346
-7 020
4 885
4 871
LIABILITIES
Financial derivatives
4 436
-2 747
-140
-64
1 599
1 615
Repos
2 341
0
0
0
2 341
2 341
Total
6 777
-2 747
-140
-64
3 940
3 956
30.06.2024 NOK MILLIONS
Related amounts not presented net
Gross financial assets/ liabilities
Financial instruments
Security in cash
Security in securities
Net amount
Adjusted for the unit holders' interest in consolidated securities funds
ASSETS
Finansielle derivater
3 766
-1 115
-2 246
-4 199
79
80
Repos
2 882
0
0
0
2 265
2 882
Total
6 647
-1 115
-2 246
-4 199
2 344
2 962
LIABILITIES
Finansielle derivater
3 218
-1 115
-35
-44
2 101
2 102
Repos
147
0
0
0
147
147
Total
3 365
-1 115
-35
-44
2 249
2 249
31.12.2024 NOK MILLIONS
Related amounts not presented net
Gross financial assets/ liabilities
Financial instruments
Security in cash
Security in securities
Net amount
Adjusted for the unit holders' interest in consolidated securities funds
ASSETS
Financial derivatives
1 469
-1 431
-483
-2 483
37
37
Repos
6 896
0
0
0
6 896
6 896
Total
8 365
-1 431
-483
-2 483
6 934
6 934
LIABILITIES
Financial derivatives
11 304
-1 431
-1 673
-6 420
3 267
3 288
Repos
0
0
0
0
0
0
Total
11 304
-1 431
-1 673
-6 420
3 267
3 288
The purpose of the note is to show the potential effect of netting agreements at the KLP Group; what possibilities the KLP Group has to net bilateral agreements against other counterparties should the latter go bankrupt and the remaining amount if all such netting agreements are materialized.The note shows derivative positions and repo agreements in the financial position statement. Repos are a part of the line "Debt to credit institutions" in the balance sheet.
The consolidated figures include all entities the KLP Group is considered to have control over. In addition, the outer line shows which de facto net amount remains if all the Groups netting agreements are set off; which only includes subsidiaries and entities, where the Group carries the risk.
Note 11 Capital adequacy
The Solvency II balance sheet includes assets and liabilities at fair value. There are no observable market values for KLP’s insurance liabilities, which are thus calculated by way of a best estimate based on actuarial assumptions. In addition there is a risk margin that is to reflect a third party’s capital costs by taking over these liabilities.
Tier 1 own funds appear from the Solvency II balance sheet and hybrid tier 1 securities. In the calculation of eligible own funds hybrid tier 1 securities are limited to a maximum of 20 percent of total eligible tier 1 own funds. Any excess exposure is eligible as tier 2 own funds. Tier 2 own funds otherwise consist of subordinated debt, the risk equalization fund, the natural perils fund and ancillary own funds. The Financial Supervisory Authority of Norway has accepted that KLP’s right to call in further member contribution if necessary, which is laid down in the Company’s articles of association, can be counted as ancillary own funds, the amount corresponding to 2.5 percent of the Company’s premium reserve. Any net deferred tax asset will be considered tier 3 own funds.
In the calculation of eligible own funds to cover the solvency capital requirement, eligible tier 1 own funds shall be at least 50 percent of the solvency capital requirement, eligible tier 3 own funds shall be less than 15 percent of the solvency capital requirement, and the sum of eligible tier 2 and tier 3 own funds shall not exceed 50 percent of the solvency capital requirement before capital requirement contributions from other financial sectors (KLP Banken and KLP Kapitalforvaltning). In the calculation of eligible own funds to cover the minimum consolidated group capital requirement, eligible tier 1 own funds shall be at least 80 percent of the minimum requirement, and eligible tier 2 own funds shall not exceed 20 percent of the minimum requirement. Own funds from other financial sectors (KLP Banken and KLP Kapitalforvaltning), tier 3 own funds and ancillary own funds are not eligible to cover the minimum requirement.
Without the use of the transitional measure on technical provisions the Company’s SCR ratio is 288 percent, which is well over the Company’s target of at least 150 percent. With the transitional measure on technical provisions the SCR ratio is 288 percent.
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
ELIGIBLE OWN FUNDS
Assets
905 352
827 334
853 502
Liabilities
-856 023
-781 772
-805 295
Excess of assets over liabilities
49 329
45 562
48 207
- Risk equalization fund
-4 311
-3 843
-4 188
+ Hybrid tier 1 securities
1 308
1 356
1 429
Adjustment for other financial sector own funds
-277
-265
-98
Tier 1 basic own funds
46 049
42 810
45 350
Sum tier 1 own funds
46 049
42 810
45 350
Subordinated debt
0
3 285
3 514
Risk equalization fund and natural perils fund
4 311
3 843
4 188
Tier 2 basic own funds
4 311
7 128
7 702
Ancillary own funds
16 167
15 019
15 396
Tier 2 ancillary own funds
16 167
15 019
15 396
Sum tier 2 own funds
20 478
22 147
23 098
Deferred tax asset
0
0
0
Tier 3 basic own funds
0
0
0
Sum tier 3 own funds
0
0
0
Eligible own funds to cover the solvency capital requirement - tier 1
46 049
42 632
45 350
Eligible own funds to cover the solvency capital requirement - tier 2
8 201
7 485
7 394
Eligible own funds to cover the solvency capital requirement - tier 3
0
0
0
A Eligible own funds to cover the solvency capital requirement
54 251
50 117
52 744
Eligible own funds to cover the minimum requirement - tier 1
42 290
39 129
41 516
Eligible own funds to cover the minimum requirement - tier 2
928
838
838
B Eligible own funds to cover the minimum consolidated group capital requirement
43 217
39 967
42 354
CAPITAL REQUIREMENT
Market risk
191 074
169 377
176 709
Counterparty risk
3 023
3 196
3 058
Life risk
140 862
126 180
140 142
Non-life risk
690
702
695
Health risk
514
457
471
Diversification
-70 692
-63 461
-68 328
Operational risk
3 817
3 491
3 576
Loss absorbing capacity of technical provisions
-251 005
-223 424
-239 819
Loss absorbing capacity deferred tax
-1 879
-1 665
-1 716
Capital requirement for other financial sectors
2 429
2 873
2 921
C Solvency capital requirement
18 832
17 726
17 710
Minimum capital requirement, KLP
4 072
3 668
3 670
Minimum capital requirement, KLP Skadeforsikring
565
523
522
D Minimum consolidated group capital requirement
4 638
4 192
4 192
CAPITAL ADEQUACY
SCR ratio (A/C)
288 %
283 %
298 %
MCR ratio (B/D)
932 %
960 %
1010 %
Note 12 Pension obligations
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Capitalized net liability 01.01.
543
913
913
Capitalized pension costs
112
117
234
Capitalized financial costs
14
16
34
Actuarial gains and losses
125
-332
-442
Premiums / contributions received
-86
-73
-195
Capitalized net liability
709
640
543
Assumptions
30.06.2025
30.06.2024
31.12.2024
Discount rate
3.70 %
3.50 %
3.90 %
Salary growth
4.00 %
3.50 %
4.00 %
The National Insurance basic amount (G)
3.75 %
3.25 %
3.75 %
Pension increases
3.00 %
2.80 %
3.00 %
Social security contribution rate
14.10 %
14.10 %
14.10 %
Capital activity tax
5.00 %
5.00 %
5.00 %
The effect of changes in pension assumptions increase the pension liability for employees with NOK125 million as of 30.06.2025. The change is recognized in "Total other income and expenses that will not be reclassified to profit or loss".
Note 13 Other current liabilities
NOK MILLIONS
30.06.2025
30.06.2024
31.12.2024
Short-term payables trade in securities
17 090
9 024
2 019
Incurred not assessed taxes
1 160
560
1 206
Accounts payable
259
290
274
Public fees
1 238
1 233
829
Other current liabilities
1 114
1 038
1 100
Total other current liabilities
20 861
12 145
5 427
Key figures – Accumulated
NOK MILLIONS
Q2 2025
Q1 2025
Q4 2024
Q3 2024
Q2 2024
Q1 2024
Q4 2023
Q3 2023
KLP GROUP
Total assets
1 194 837
1 148 840
1 147 389
1 128 114
1 079 281
1 065 541
1 016 721
972 345
Equity
-2 255
-3 291
-3 303
-2 594
-2 556
-3 090
-3 140
-3 555
Solvency SCR ratio
288 %
290 %
298 %
289 %
283 %
288 %
285 %
332 %
Number of employees in the Group
1 205
1 189
1 169
1 168
1 168
1 153
1 133
1 120
KOMMUNAL LANDSPENSJONSKASSE
Profit before tax
1 167
205
2 169
1 663
926
183
-20
1 136
Premium income for own account
42 711
8 110
60 883
51 795
37 257
7 842
70 326
60 032
- of which inflow of premium reserve
40
40
1
1
1
0
92
91
Insurance customers' funds incl. acc. profit
18 422
11 233
30 200
23 024
16 132
9 265
28 261
21 501
- of which funds with guaranteed returns
4 132
4 289
2 423
2 423
2 419
2 456
2 139
2 125
Net investment common portfolio
825 733
805 349
803 441
790 200
761 757
751 512
734 337
718 214
Net investment choice portfolio
3 348
3 105
3 135
3 063
3 064
2 953
2 830
2 730
Insurance funds incl. earnings for the year
847 325
797 920
803 036
788 668
778 458
745 385
725 781
704 815
- of which funds with guaranteed interest
707 855
678 596
679 801
638 919
642 860
617 219
616 315
586 941
Solvency capital requirement (SCR)
54 711
53 359
52 962
52 772
50 482
49 575
49 517
49 918
Solvency SCR ratio
336 %
355 %
361 %
351 %
344 %
351 %
346 %
368 %
Riskprofit
78
168
790
420
81
82
648
364
Return profits
17 261
-4 094
51 090
40 471
26 553
18 729
29 466
15 822
Administration profit
32
-27
77
129
65
-8
144
176
Solvency capital
163 264
159 022
162 859
193 589
167 161
155 824
164 487
147 893
Value-adjusted return on common portfolio
3,1 %
0,0 %
9,0 %
7,0 %
4,6 %
3,0 %
6,4 %
3,9 %
Return on unit-linked portfolio
3,1 %
-0,8 %
10,8 %
8,6 %
5,8 %
4,0 %
8,3 %
4,8 %
Return on corporate portfolio
2,4 %
0,6 %
4,8 %
3,4 %
1,9 %
0,5 %
3,0 %
2,1 %
KLP SKADEFORSIKRING AS
Profit before tax
193
32
386
196
64
-118
273
255
Insurance income
1 532
786
2 758
2 053
1 365
707
2 505
1 863
Owners' equity
3 089
2 979
2 955
2 760
2 669
2 523
2 594
2 589
Claims ratio, gross
75,4 %
74,8 %
77,3 %
79,2 %
81,4 %
98,2 %
83,5 %
78,9 %
Net reinsurance ratio
6,4 %
8,8 %
6,4 %
8,3 %
9,7 %
15,0 %
2,8 %
4,7 %
Claims ratio, net of reinsurance
81,7 %
83,6 %
83,8 %
87,6 %
91,2 %
113,1 %
86,3 %
83,6 %
Cost ratio
13,9 %
15,1 %
13,0 %
13,6 %
13,6 %
14,6 %
14,0 %
13,0 %
Combined ratio
95,6 %
98,7 %
96,8 %
101,1 %
104,8 %
127,7 %
100,4 %
96,6 %
Return on assets under management
2,7 %
0,7 %
6,2 %
5,0 %
2,9 %
1,7 %
5,5 %
3,3 %
Solvency capital requirement (SCR)
2 969
2 785
2 598
2 487
2 446
2 514
Solvency SCR ratio
242 %
246 %
256 %
238 %
223 %
210 %
227 %
246 %
Annual premium in force – retail market
1 330
1 268
1 620
1 178
1 149
1 107
1 068
1 042
Annual premium in force – public sector market
1 798
1 784
1 222
1 613
1 601
1 624
1 517
1 533
Net new subscriptions (accumulated within the year)
59
33
20
-14
-38
-3
72
61
KLP BANKEN GROUP
Profit/loss before tax
184
77
325
255
167
75
285
203
Net interest income
271
133
520
386
255
127
465
340
Other operating income
48
24
96
71
46
22
89
67
Operating expenses and depreciation
-144
-81
-284
-208
-140
-81
-271
-201
Net realized/unrealized changes in financial instruments to fair value