The Tribune

Colina Holdings (Bahamas) has blamed the damage inflicted by COVID-19 on the value of its investment holdings for a 76.6 percent comprehensive income drop for the nine months to end-September.

The BISX-listed life and health insurance holding company disclosed that comprehensive income attributable to equity shareholders fell year-over-year from $11.5m to $2.7m during the first nine months of 2020.

It said this resulted from "the significant impact that the mark-to-market price adjustments on its investment securities" are having. Net income attributable to ordinary shareholders held relatively firm, though, coming in at $8.6m or $0.35 per ordinary share compared to the prior year's $8.9m and $0.36 per ordinary share for the first nine months.

"These mark-to-market revaluation losses were reflected in net investment income, which totals $8.6m compared to $32.9m in the prior year," Colina Holdings (Bahamas) said.

"Additional fair value losses were recognised through the revaluation reserve on investment securities classified as available for sale totalling $7.7m. The company ensures that, as part of its long-term strategy, it maintains a strong capital base to withstand these interim periods of price volatility.

“Local commercial activity has been stifled during 2020 due to the impact of the COVID-19 pandemic on the Bahamian economy,” said Terence Hilts, Colina Holdings (Bahamas) chairman. “The company continues to have the strong balance sheet to weather income statement volatility, particularly during these times of economic change and uncertainty."

The valuation reductions affecting net investment income were also largely responsible for the 22 percent year-over-year revenue decline suffered by the life and health insurance conglomerate during the first nine months of 2020.

Total revenues totalled $108.3m compared to $138.7m in 2019. Gross premium revenues through September 30, 2020, were down $4.3m as new business and renewal premiums were challenged by COVID-19's fall-out. Net premium revenues totalled $83.5m compared to $88.7m for the same period in 2019.

Colina Holdings (Bahamas) said the decrease in revenues was slightly offset by a reduction in claims, with net policyholder benefits totalling $60.6m for the nine months ended September 30, 2020, compared to $67.6m in the prior year.

There was also a reduction of provisions for future policyholder benefits totalling $3.1m, compared to an increase in actuarial reserves of $20.1m during the same period in 2019.

The mark-to-market adjustments seen in the income statement and revaluation reserve also affected the company's investment securities balance at September 30, 2020. This had had fallen to $439.3m, a decrease from $445.8m at December 31, 2019.

Total assets at September 30, 2020, were $788.6m, with invested assets remaining the largest component of total assets at 78.8 percent.

“Prior to any consideration of dividend distributions, we carefully assess the company’s capital position,” said Mr Hilts. “We remain focused on ensuring that the company’s capital base remains sufficiently strong to meet future obligations to its policyholders and shareholders.”