Insular Life Assurance Corp gets P1-billion loan

The Insular Life Assurance Corp. has received a P1-billion loan package, boosting its fixed income fund portfolio.

Placing third overall among the country’s life insurance companies last year, Insular Life extended a term loan worth P500 million to major conglomerate Ayala Corp. and another P500-million to the International Container Terminal Services Inc. (ICTSI), one of the country’s biggest players in container port terminals industry.

Insular Life chief investment officer Mayo Ongsingco said the loan will allow Insular Life to lock-in interest income at relatively competitive rates with low-risk borrowers.

"Given the nature of Insular Life’s business requirements, there is a need to explore investment opportunities that will match its long-term obligations and at the same time meet its investment income targets," Ongsingco said.

He added that the term loans to companies like Ayala Corp. and ICTSI would offer them some of the most stable sources of income.

In 2001, Insular Life’s investment income reached P1.4 billion slightly lower than the P1.6 billion recorded in 2000.

Most investment earnings came from placements in government securities, commercial papers, and other low risk financial products. It also has equity exposures in Honda Philippines Inc. and Union Bank of the Philippines.

Insular Life recorded a 13-percent growth in total premium income, or from P4.8 billion in 2001 to P5.5 billion last year. First-year premium income grew by 36 percent from P810 million in 2001 to P1.1billion to in 2002.

For this year, the insurance firm is expecting its premium income to reach P6.8 billion, or P1.3 billion higher than the previous year’s level.