Finnish banks’ and insurers’ performance and operating environment in 2023: Banks unshaken by international crises, insurers also enjoyed a good year

Finance Finland’s reports show that the Finnish banking and insurance sectors both had a good year, and their profits, performance and capital position remained on a high level. Image: Shutterstock
  • Finance Finland has published its overviews of banks’ and insurers’ performance and operating environment in 2023.
  • Both sectors had a good year: profits, performance and capital position remained on a high level.
  • Insurers’ results were boosted especially by the positive performance of listed shares and bonds.
  • The resilience of Finnish banks was improved by retained earnings, additional capital buffers and a good liquidity position.

Finnish banking is an annual overview on the Finnish banking sector, its structure and its operating environment. Finnish insurance is a financial overview examining Finnish insurance companies’ performance and key figures. Both are published by Finance Finland once a year. Links to the full reports and key figures are included at the end of this article.

Russia’s ongoing war of aggression in Ukraine continued to affect the banking and insurance sectors. Towards the end of the year, however, there was a sharp upward turn in stock prices, which had been falling since the start of the war. At the same time, inflation began to ease off and market interest rates to decrease, which improved bond yields.

“Shares and bonds are the biggest investment classes for Finnish insurers, and their investment income is very important in terms of the companies’ overall profits. Now both classes generated good returns, which noticeably improved insurers’ results”, says Finance Finland’s Analyst Kimmo Koivisto, author of the Finnish insurance report.

Life and non-life insurers both maintained good solvency ratios despite a decrease in the last quarter. Authorised pension companies’ solvency position remained more or less unchanged.

The banking sector remained stable despite international turbulence

The Finnish banking sector’s capital adequacy remained strong and above the European average at the end of the year. The banking sector’s common equity tier 1 (CET1) capital ratio was 18.3%, and its total capital ratio was 22.1%.

In the spring of 2023, the entire sector was shaken by the US and Swiss banking crises. Finland’s financial system remained stable despite the turbulence in the international financial markets.

“Finnish banks’ good profitability and liquidity make them resilient against economic disruptions. The good reputation of Finnish banks, which is based on solid capital positions and high-quality assets, has ensured their access to international financial markets even in times of market disruptions”, says Finance Finland’s Adviser Jussi Kettunen, author of the Finnish banking report.

Thanks to its sound basis, the sector can offer customers flexibility in loan payments and provide other forms of support in the face of crises, thus directly benefiting the real economy. 

Other topics that featured heavily in the banking sector included climate change and its effects and mitigation. The year was one of the hottest years on record. The EU aims to make Europe the world’s first climate-neutral continent by 2050, and Finland’s goal is to become a carbon-neutral country by 2035. The banking sector holds a key role in this change, as finance will be increasingly redirected towards green investments.

Number of employees is on the rise

The number of employees increased in both sectors. The annual average number of persons employed by Finnish insurance companies was 10,500, which is 250 employees more than the year before. Finnish banking groups and foreign deposit-taking banks’ Finnish branches employed about 21,100 people at the end of 2023. This is almost 1,200 employees more than in the previous year.

At the end of the year, there were 47 licensed Finnish insurers and 20 branches operated by non-Finnish insurers in Finland. If group structures are ignored, there were 185 credit institutions operating in Finland. This is 11 fewer than at the end of 2022, the decrease being mainly due to mergers within banking groups.

Insurance sector key figures 2023

  • Insurance premiums written in Finland increased by 4% to a total of €28.3 billion.
  • Return on investments was 6%.
  • Life insurers’ premium income grew 4%, totalling €4.6 billion.
  • Non-life insurers’ premiums written increased by 5% to €5.4 billion.
  • Premiums written in statutory employee pension insurance grew by 4% to €18.4 billion.
  • Claims and pension benefits were paid out for €27.7 billion. This represents a growth of 7% from the previous year.


Banking sector key figures 2023

  • The banking sector’s common equity tier 1 (CET1) capital ratio was 18.3% (17.2% in 2022), and its total capital ratio was 22.1% (20.6%).
  • The Finnish banking sector’s return on equity (ROE) stood at 13.9% at the end of the year (9.6%).
  • The banking sector’s profit increased 39% from the previous year, totalling about €9.2 billion.

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