26 Equity
Share capital
As at 31 December 2022, the share capital of Swiss Life Holding consisted of 30 825 887 fully-paid shares with a par value of CHF 0.10 each (2021: 31 528 567 fully-paid shares with a par value of CHF 0.10 each). In exercising voting rights, no shareholder can collect more than 10% of the total share capital directly or indirectly in respect of own shares or shares they represent. Conditional share capital was CHF 385 794.80 as at 31 December 2022 (2021: CHF 385 794.80).
Share premium
Share premium comprises additional paid-in capital in excess of the par value (net of transaction costs), gains /losses on own equity instruments and equity compensation benefits.
Share buyback programmes
As announced during the investor’s day on 25 November 2021, Swiss Life started a new CHF 1 billion share buyback programme in December 2021. By 31 December 2022, 1 403 881 shares had been purchased for CHF 739 million at an average price of CHF 525.80 per share, of which 1 335 881 shares for CHF 701 million in 2022 and 68 000 shares for CHF 38 million in 2021. The programme will be completed in May 2023.
In May 2021, Swiss Life completed the CHF 400 million share buyback programme, which had been announced in February 2020. Between March 2020 and May 2021 a total of 908 423 own shares were repurchased at an average purchase price of CHF 440.32 per share. In 2021, 829 099 shares were purchased for CHF 371 million.
702 680 of the repurchased shares were cancelled in July 2022 and 485 824 shares were cancelled in July 2021.
Number of shares
The following table shows the development of Swiss Life Holding shares issued and treasury shares held by the Swiss Life Group during the period.
| Number of shares | ||||
|---|---|---|---|---|
| 2022 | 2021 | |||
| Shares issued | ||||
| Balance as at 1 January | 31 528 567 | 32 014 391 | ||
| Cancellation of treasury shares | –702 680 | –485 824 | ||
| Balance as at end of period | 30 825 887 | 31 528 567 | ||
| Treasury shares | ||||
| Balance as at 1 January | 620 842 | 219 132 | ||
| Purchases of treasury shares | 50 000 | 35 000 | ||
| Share buyback | 1 335 881 | 897 099 | ||
| Allocation under equity compensation plans | –41 912 | –44 565 | ||
| Cancellation of treasury shares | –702 680 | –485 824 | ||
| Balance as at end of period | 1 262 131 | 620 842 | ||
Accumulated other comprehensive income
Accumulated other comprehensive income comprises items of income and expense that are recognised outside of profit or loss, as required or permitted by certain IFRSs.
Items presented in other comprehensive income are grouped on the basis of whether they will be reclassified subsequently to profit or loss when specific conditions are met, and those that will not be reclassified.
The amounts are presented net of certain policyholder bonuses and other policyholder liabilities, deferred acquisition costs, deferred income taxes and non-controlling interests.
Items that may be reclassified to profit or loss comprise:
- Foreign currency translation differences arising on the translation of assets, liabilities, income and expenses of Group entities denominated in foreign currencies into Swiss francs.
- Gains and losses from fair value changes of financial assets available for sale.
- Effective portion of gains and losses on hedging instruments in qualifying cash flow hedges.
- Unrealised losses on financial assets reclassified from available for sale to loans and receivables in 2008 due to disappearance of an active market.
Items that will not be reclassified to profit or loss comprise:
- Revaluation surplus on the transfer of owner-occupied property to investment property following a change in use evidenced by the end of owner-occupation.
- Remeasurements of the net defined benefit liability relating to employee benefit plans.
The following table provides information relating to amounts recognised in accumulated other comprehensive income.
Accumulated other comprehensive income for the year 2022
| In CHF million | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items that may be reclassified to the income statement | Items that will not be reclassified to the income statement | Total | ||||||||||||||||
| Foreign currency translation differences | Gains/ losses financial assets available for sale | Gains/ losses cash flow hedges | Gains/ losses debt securities reclassified to loans and receivables | Total | Revalu-ation surplus investment property | Remea-sure-ments net defined benefit liability | Total | |||||||||||
| Net balance as at 1 January | –1 351 | 4 066 | 314 | –9 | 3 020 | 45 | –261 | –216 | 2 804 | |||||||||
| Transfer to retained earnings | – | – | – | – | – | –46 | –3 | –50 | –50 | |||||||||
| Net other comprehensive income | –228 | –6 011 | –212 | 3 | –6 447 | 42 | 205 | 247 | –6 200 | |||||||||
| Net balance as at end of period | –1 579 | –1 945 | 102 | –5 | –3 427 | 40 | –59 | –19 | –3 446 | |||||||||
| Net other comprehensive income is composed of the following: | ||||||||||||||||||
| Revaluation – gross | –324 | –21 473 | –721 | – | –22 517 | – | 632 | 632 | –21 886 | |||||||||
| Net investment hedges – gross | 89 | – | – | – | 89 | – | – | – | 89 | |||||||||
| Share of other comprehensive income of associates – gross | – | – | – | 0 | 0 | – | – | – | 0 | |||||||||
| Reclassification to profit or loss – gross | 1 | 688 | –289 | 6 | 406 | – | – | – | 406 | |||||||||
| Effects of | ||||||||||||||||||
| policyholder participation | 2 | 13 010 | 729 | –1 | 13 740 | 40 | –378 | –338 | 13 403 | |||||||||
| shadow accounting | – | 205 | 5 | 0 | 210 | 0 | – | 0 | 210 | |||||||||
| income tax | 0 | 1 552 | 64 | –1 | 1 615 | 2 | –50 | –48 | 1 567 | |||||||||
| foreign currency translation differences | – | 6 | –1 | 0 | 6 | –1 | 1 | 0 | 6 | |||||||||
| Net other comprehensive income before non-controlling interests | –232 | –6 011 | –212 | 3 | –6 452 | 42 | 205 | 247 | –6 205 | |||||||||
| Non-controlling interests | 4 | 1 | 0 | 0 | 5 | 0 | 0 | 0 | 5 | |||||||||
| Net other comprehensive income | –228 | –6 011 | –212 | 3 | –6 447 | 42 | 205 | 247 | –6 200 | |||||||||
Accumulated other comprehensive income for the year 2021
| In CHF million | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items that may be reclassified to the income statement | Items that will not be reclassified to the income statement | Total | ||||||||||||||||
| Foreign currency translation differences | Gains/ losses financial assets available for sale | Gains/ losses cash flow hedges | Gains/ losses debt securities reclassified to loans and receivables | Total | Revalu-ation surplus investment property | Remea-sure-ments net defined benefit liability | Total | |||||||||||
| Net balance as at 1 January | –1 178 | 5 118 | 383 | 6 | 4 328 | 64 | –397 | –333 | 3 995 | |||||||||
| Net other comprehensive income | –173 | –1 052 | –69 | –14 | –1 308 | –19 | 136 | 117 | –1 191 | |||||||||
| Net balance as at end of period | –1 351 | 4 066 | 314 | –9 | 3 020 | 45 | –261 | –216 | 2 804 | |||||||||
| Net other comprehensive income is composed of the following: | ||||||||||||||||||
| Revaluation – gross | –153 | –3 364 | –267 | – | –3 784 | – | 327 | 327 | –3 457 | |||||||||
| Net investment hedges – gross | –19 | – | – | – | –19 | – | – | – | –19 | |||||||||
| Reclassification to profit or loss – gross | –3 | –525 | –49 | 2 | –574 | – | – | – | –574 | |||||||||
| Effects of | ||||||||||||||||||
| policyholder participation | 1 | 2 476 | 228 | –16 | 2 688 | –18 | –161 | –179 | 2 509 | |||||||||
| shadow accounting | – | 122 | 3 | 0 | 125 | 0 | – | 0 | 125 | |||||||||
| income tax | 0 | 274 | 18 | 0 | 292 | –1 | –31 | –32 | 260 | |||||||||
| foreign currency translation differences | – | –36 | –2 | 0 | –38 | –1 | 2 | 1 | –38 | |||||||||
| Net other comprehensive income before non-controlling interests | –175 | –1 052 | –69 | –14 | –1 310 | –19 | 136 | 117 | –1 193 | |||||||||
| Non-controlling interests | 2 | 0 | 0 | 0 | 2 | 0 | 0 | 0 | 2 | |||||||||
| Net other comprehensive income | –173 | –1 052 | –69 | –14 | –1 308 | –19 | 136 | 117 | –1 191 | |||||||||
Retained earnings
Retained earnings comprise accumulated retained earnings of the Group entities which have not been distributed to the shareholders. The distribution of profit is subject to restrictions in the various jurisdictions where the Group entities are located.
The Group’s insurance subsidiaries are subject to regulatory restrictions on the amount of dividends, cash loans and advances which can be remitted to the Group. Certain foreign jurisdictions have restrictions that allow the payment of dividends but may cause a delay in their remittance. Dividends payable are not accrued until they have been ratified at the General Meeting.
In 2022, a dividend payment of CHF 764 million or CHF 25.00 per registered share was made (2021: CHF 654 million or CHF 21.00 per registered share).
Hybrid equity
On 29 March 2021, Swiss Life Ltd placed a perpetual subordinated bond in the amount of CHF 250 million , presented in equity . The bonds are guaranteed by Swiss Life Holding and are first callable on 30 September 2026 or at each interest payment date thereafter at the option of the issuer, upon notice and subject to the consent of the Swiss Financial Market Supervisory Authority. The interest has been fixed at 1.75% p.a. until 30 September 2026. If the bonds are not redeemed on 30 September 2031, the interest resets at a rate fixed for the subsequent five years, consisting of the aggregate of the then-prevailing five-year CHF mid-market swap rate vs. SARON plus initial margin (218.2 bps).
On 22 March 2018, Swiss Life Ltd issued subordinated perpetual callable bonds in the amount of CHF 425 million. The bonds are guaranteed by Swiss Life Holding, have no fixed maturity date and are first callable on 25 September 2024 or at each interest payment date thereafter at the option of the issuer, upon notice and subject to the consent of the Swiss Financial Market Supervisory Authority. The interest has been fixed at 2.00% p.a. until 25 September 2024. If the bonds are not redeemed on 25 September 2024, the interest resets at a rate fixed for the subsequent five years, consisting of the aggregate of the then-prevailing five-year CHF swap rate and the initial margin of 1.842% p.a. The bonds are classified as equity instruments.
Interest payments for hybrid equity become mandatory depending on other transactions, which are themselves at the discretion of the Swiss Life Group, such as dividend payments. There is no accrual of interest to be recorded for the annual financial statements. The interest net of tax of CHF 11 million (2021: CHF 9 million) is accounted for as a deduction from equity.
Non-controlling interests
Summarised financial information for subsidiaries with material non-controlling interests is as follows.
| In CHF million | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| SwissLife Banque Privée Paris | TECHNOPARK Real Estate LTD Zurich | Swiss Life Asset Managers Holding (Nordic) AS Oslo | ||||||||||
| 2022 | 2021 | 2022 | 2021 | 2022 | 2021 | |||||||
| Principal place of business | France | France | Switzerland | Switzerland | Norway | Norway | ||||||
| Ownership interests held by non-controlling interests | 40.0% | 40.0% | 33.3% | 33.3% | 10.0% | 10.0% | ||||||
| Voting rights held by non-controlling interests | 40.0% | 40.0% | 33.3% | 33.3% | 10.0% | 10.0% | ||||||
| Summarised financial information before intragroup eliminations | ||||||||||||
| Current assets | 2 405 | 2 875 | 16 | 11 | 23 | 22 | ||||||
| Non-current assets | 597 | 395 | 232 | 231 | 116 | 134 | ||||||
| Current liabilities | –2 606 | –3 139 | –69 | –68 | –17 | –16 | ||||||
| Non-current liabilities | –270 | –16 | –25 | –24 | –6 | –9 | ||||||
| Net assets | 126 | 115 | 154 | 150 | 116 | 131 | ||||||
| Accumulated non-controlling interests | 50 | 46 | 51 | 49 | 12 | 13 | ||||||
| Revenue | 161 | 139 | 11 | 16 | 27 | – | ||||||
| Profit or loss | 25 | 15 | 7 | 13 | 4 | – | ||||||
| Total comprehensive income | 25 | 15 | 7 | 13 | 4 | – | ||||||
| Profit or loss allocated to non-controlling interests | 10 | 6 | 2 | 4 | 0 | – | ||||||
| Net cash flows from operating activities | –408 | 788 | 7 | 6 | 3 | – | ||||||
| Net cash flows from investing activities | –1 | –1 | 0 | 0 | 0 | – | ||||||
| Net cash flows from financing activities | –6 | –5 | –1 | –1 | 0 | – | ||||||
| Net change in cash and cash equivalents | –415 | 782 | 6 | 5 | 3 | – | ||||||
| Dividends paid to non-controlling interests | –4 | –2 | –1 | –1 | – | – | ||||||