From an Investments perspective, we concluded yet another challenging year where our key focus was on managing our policyholders’ funds with utmost care, particularly in a period of uncertainty - both locally and globally. Similar to the past, by prioritizing clarity and caution in our investment decisions, we reinforced the trust placed in us and ensured that our actions aligned with the core values and long-term vision of the organization.

COMPOSITION AND MEETINGS

The Committee comprised of the following members during the year, including as of 31st December 2024.

The Company Secretary acts as the Secretary to the Board Investment Committee. The Chief Risk Officer, Head of Investments – Front Office and the Senior Dealer attended meetings by invitation. Mr R S W Senanayake, an industry veteran acts as a Consultant to the Committee.

PURPOSE OF THE COMMITTEE

The Committee was established by the Board of Directors of Ceylinco Life to ensure compliance with the “Guidelines on Investment for Insurance Companies” issued by the Insurance Regulatory Commission of Sri Lanka (IRCSL) and principles of good governance. The main purpose of the Committee is to set out and oversee the policies relating to the governance of investment management, management of investment portfolios and associated risks.

TERMS OF REFERENCE

The Terms of Reference of the Committee outlines the composition, role and responsibilities of the Committee. The primary objectives of the Committee is to oversee the investment decision making process , investment management function and investment risk management, while providing direction and guidance to the Strategic Asset Allocation of investments.

KEY RESPONSIBILITIES

▶ Review and recommend significant and critical investment strategies and proposals to the Board.

▶ Exercise due care to ensure that the interests and rights of policyholders are not compromised.

▶ Ensure full compliance with laws, rules, regulations, determinations and guidelines issued by the IRCSL and other relevant Regulatory Authorities.

▶ Institute effective and efficient governance of investment activities of the Company.

▶ Ensure that the Company has a sound risk management framework for identifying, monitoring and mitigating various risks arising from investment activities / fluctuations in macroeconomic parameters and provide necessary oversight to ensure effective and efficient management of the investment portfolio.

▶ Review the adequacy of investment related internal controls and risk management systems to support prudent investment management.

▶ Review the investment policy and other related policy documents of the Company in a timely manner to ensure that it remains applicable and in-line with the changes in business, regulatory and economic environment.

KEY ACTIVITIES OF 2024

Prudent Investments

▶ Reviewed and recommended the significant and critical investment proposals and strategies to the Board.

▶ Ensured that investments were made prudently, aligned with diverse investment objectives and risk profiles, while effectively positioning and managing funds to meet the expectations of key stakeholders, including policyholders, shareholders and regulators.

▶ In response to the evolving financial and economic landscape, all investment-related policies were reviewed, to capitalize on unique investment opportunities. As interest rates declined significantly throughout the year amidst economic recovery, necessary revisions were proposed to the Board for approval to optimize portfolio performance.

▶ In response to a more favourable economic outlook, we strategically introduced an allocation to non fixed income securities, under carefully defined limits and a rigorous monitoring framework. This approach allowed us to tactically capitalize on market movements while ensuring risk was effectively managed in line with our investment objectives.

▶ Invested in upgrading SAP S/4HANA ERP solution, enhancing our investment management capabilities, improving information processing and risk management, amongst many other benefits.

▶ Investment-Related Internal Controls

▶ Ensured that a sound Risk Management Framework was maintained for identifying, monitoring and mitigating various risks arising from investment activities and provided necessary oversight to ensure effective and efficient management of the investment portfolio.

▶ Reviewed the performance of investments as per the guidelines issued by the IRCSL and monitored the portfolio performance, composition and credit quality on a quarterly basis.

▶ Periodically reviewed the adequacy of investment-related internal control and risk management systems to support prudent investment activities.

▶ Reviewed the Investment Policy of the Company and other investment related policy documents in a timely manner to ensure that it remains applicable and in line with the changes in the business, regulatory and economic environment.

▶ Reviewed the critical internal audit f indings related to investment decision making and related operations.

COMPLIANCE

The Committee oversaw effective and efficient governance of investment activities of the Company. Due care was exercised to ensure that the interests and rights of Policyholders were not compromised at any time.

Further, the Committee reviewed and ensured that laws, rules, regulations, determinations and guidelines issued by the IRCSL, and other relevant regulatory authorities were fully complied with.

PROFESSIONAL ADVICE

The Committee is authorized to seek external professional advice where deemed necessary on matters within their purview. During the year, such advice was specifically sought on market interest rate movements, expected path of monetary and fiscal policy, domestic and external debt restructuring and analysis of key macro-economic variables.

COMMITTEE EVALUATION

The annual evaluation of the performance of the Committee was carried out by the Board and the Committee was deemed to be operating effectively.

R Renganathan

Chairman - Board Investment Committee

20th February 2025