ICBC Net Income $117 Million

ICBC Net Income Up Over 2008

Basic Rates Remain Unchanged

ICBC reported strong financial results for the first three months of 2009, despite the ongoing challenges posed by the economic downturn.

Net income for the first quarter of 2009 was $117 million, up from $102 million for the same period in 2008.

"We are pleased with our financial results given the tough economic times we are all experiencing," said Jon Schubert, ICBC's President and CEO. "In particular, the continuing decline in the number and cost of injury claims is good news for our customers. Good weather and improved claims-handling procedures have benefited our customers and had a positive impact on our net income."

Claims and related costs for the first quarter of 2009 were down to $735 million from $761 million for the same period in 2008. ICBC's customers continue to do their part to contribute towards this decline in claims costs and to keep rates low and stable by driving safely, while a moderation in the number of vehicles on the road has also played a role.

The impact of the economic downturn is evident at ICBC, resulting in lower premiums of $843 million from January to March, 2009, compared to $860 million from the first quarter of 2008. The slowdown in premiums written will likely have a greater impact on ICBC's financial results going forward throughout the year.

ICBC's investment income for the first quarter of 2009 was $123 million, relatively flat compared to the same period in 2008. The corporation's conservative and long-term investment strategy – with the majority of its portfolio invested in high-quality bonds – continues to position us well for the future.

ICBC also continues to be an industry leader with low operating costs, which are consistent with Q1 2008 despite the challenging economic times. Similar to previous years, approximately just four cents of every premium dollar will be used for administrative costs to operate its insurance business in 2009.

"Our strong performance in these tough times is benefiting our customers," said Schubert. "Our financial strength is allowing us to reduce optional rates for 2009 by an average of three percent effective October 1, 2009. Preliminary indications are that basic rates will remain the same for this year."

Editor's Note: If they really want to benefit customers, perhaps reducing the basic rate is a better place to start. Reducing optional rates is likely being done to address competitive pressures from other insuring companies more than it is being done to help BC drivers.