2021 summaryThe Wesleyan Group delivered a £6.1m operating profit and Assets under Management rose by 8% from £7.9bn to £8.5bn in 2021. The Group retained its capital strength and progress was made against Wesleyan’s strategic plans, further strengthening the sustainability of the business.
The Group demonstrated its commitment to mutuality and its specialist customer base by distributing a £36m mutual bonus and delivering a 12.7% return for Wesleyan investors in its With Profits Fund. Customers also benefitted from investments made in Wesleyan’s online proposition, making it easier to transact and invest online.
The Group continued with the work of its charitable Foundation which donated £1m to good causes linked to its professional customers and the UK’s recovery from Covid-19.
- The Society made an operating profit* of £6.1m (2020: loss £18.6m) reflecting increases in new business volumes and a managed reduction in expenses.
- The Group maintained its capital strength with £589m (2020: £565m) in the Group Fund for Future Appropriations, representing the excess of assets over liabilities and therefore the financial strength of the organisation.
- The Society’s financial strength means it is in a position to distribute funds in the form of a £36m mutual bonus in 2022 based on 2021 performance (2020: £29.7m).
- A substantial investment of £34.5m (2020: £28.0m) to continue with key transformation activity reflects Wesleyan’s commitment to building a stronger, more sustainable business to benefit members and customers.
- Assets under management grew to £8.5bn from £7.9bn as a result of new business income and improved investment returns. This also led to a competitive 12.7% return for the With Profits Fund, which shows a strong long-term performance (+114% return over ten years**).
- Wesleyan subsidiary Practice Plan Group grew the number of patients on plan to over 1 million.
- Wesleyan Bank grew the loans and advances on its balance sheet by 28%.
* Group operating profit/loss represents profit before investment fluctuations and other accounting and tax adjustments. 2020 profit restated.
** After smoothing and before charges applied.
Strategic plan delivery
Wesleyan progressed its strategic plans, delivering a number of projects that support the long-term sustainability of the business and add value to members. These included:
- The sale of Wesleyan Bank – The Bank was sold to Hampshire Trust Bank Plc in February 2022 allowing Wesleyan greater focus and investment in its core customer offering.
- Increased access to Wesleyan With Profits Fund – The Fund was added to a third-party investment platform providing access for the first time to Independent Financial Advisers and their clients. Growing the Fund provides the potential for a stronger member benefits programme.
- Sustainable investing proposition launched – All Wesleyan’s own funds now meet new sustainable criteria that help reduce harm, have a positive impact and drive change. To achieve this, £40m of less sustainable assets were divested and investments bolstered in companies aligning with the new criteria.
Wesleyan remains committed to its mutual status and was able to deliver benefits to members and communities in 2021 despite the challenging operating environment.
- £36m mutual bonus (2020: £29.7m) distributed to Wesleyan investors in the With Profits Open Fund to boost investment returns***
- £2.5m (2020: £2.1m) financial contribution made to provide member discounts on selected insurance policies
- £1m donated to good causes (2020: £870k) taking the Wesleyan Foundation to £3.9m donated since it was launched in 2017
- 98% (2020: 96%) of personal income protection claims paid compared to an industry average of 87%****
*** Each Wesleyan investor in the With Profits Open Fund received a 1% uplift on the value of their investment fund in April 2022. Not applicable to investors accessing the Fund via the third party platform.
**** Association of British Insurers (ABI).
Mario Mazzocchi, Wesleyan Group Chief Executive said: “2021 was a landmark year for Wesleyan as we celebrated our 180th anniversary. We were pleased to get the business back to profitability after the difficult trading conditions caused by the Covid-19 pandemic.
“We increased our capital strength and shared the benefits of this by distributing excess surplus through a mutual bonus of £36m to Wesleyan investors in our With Profits Open Fund. We also delivered a number of key strategic initiatives that have helped to strengthen our business and should deliver greater value to members.
“We will continue to implement our strategy of sustainable growth over the coming years. As a mutual, with high levels of financial strength, we can continue to take a long-term approach that ensures we deliver the right outcomes for members and customers both today and in the future.”
Chair Nathan Moss added: “We were pleased to see the plans we made in 2020 to protect Wesleyan against the ongoing impact of the Covid-19 pandemic pay off and help get the business back on-track in 2021.
“We made progress in a number of key strategic areas including significant enhancements to our sustainability and inclusion agendas. We were pleased to win awards for excellence in responsible business, championing social mobility and championing gender diversity over the year in recognition of the work we’ve done in these areas. However, we still have some distance to go to achieve our inclusion ambitions and have robust plans in place to support us on this journey.
“Wesleyan’s performance in 2021 pays testament to the passion and commitment of our people and the Executive team who lead them. I thank them for their hard work and also our members and customers whom we are proud to serve.”