FBD has announced plans to ‘simplify’ its business as part of a €7m cost-saving plan announced today (Monday).

It reported an operating loss per share off 221c and an operating loss of €87m. Its net claims almost doubled to €215m from €117m in 2014, while it says it made underwriting losses for the past three years.

Commenting on these results:  Interim Chief Executive Officer Fiona Muldoon said it was a difficult day for FBD, its shareholders and staff.

“These results reflect very serious increased claims costs in our industry. We are taking decisive action now to de-risk our strategy and return to profitability by the end of 2016.

“FBD has a great customer base and the relationships, infrastructure and claims paying strength to meet our customers’ needs into the future. I am confident that the steps outlined today will put FBD on the path to profitability.”

The company also announced that it expects the industry to be loss making during 2015 and 2016

Under its new new strategic direction it will look to simplify FBD. A statement says it will be concentrating on servicing its core customers, with a clear ambition of returning the Group to profits by the end of 2016.

It will also de-risk its underwriting strategy and focus its time and resources in the consumer market on one brand only.

The following actions will be, or have been, taken:

  • Prior year claims reserves strengthened by €88m;
  • Cost saving target of €7 million; representing 2% of COR; to be identified and implemented in 2015/Q1 2016;
  • Our capital position is strengthened through (Reforming its retirement benefit arrangements with the closure to future accrual of the defined benefit pension scheme & disposal of the property & leisure joint venture (subject to shareholder approval) with the proceeds earmarked for investment as equity into FBD Insurance)
  • Exploration of options for raising regulatory capital in the debt capital markets.