Lloyd’s has returned to profit after two straight years of losses and says it is in a strong position to respond to coronavirus pandemic impacts.

“While we are pleased to be announcing Lloyd’s return to profitability in 2019 and continued progress across our priorities, our primary focus right now is on supporting our customers and business partners in their time of need,” CEO John Neal said.

“I am confident in Lloyd’s ability to meet the challenges before it, and in doing so demonstrate the market’s unrivalled ability to support people, businesses and countries around the world in response to the far-reaching impacts of COVID-19.”

Chairman Bruce Carnegie-Brown says the corporation has a plan in place to mitigate risks to the asset portfolio amid financial market volatility.

“The corporation is also well advanced in gathering and assessing the market’s liability for claims, including asking the market to report on expected losses connected to the impact of COVID-19, as we do for any potential large loss events,” he said.

Lloyd’s reported a £2.5 billion ($5 billion) pre-tax profit for last year, compared with a £1 billion ($2 billion) loss 12 months earlier, attributing the turnaround to a strong investment performance alongside rate increases and improved underwriting discipline.

The combined operating ratio improved to 102% from 104.5% while gross written premium was little changed at £35.9 billion ($71.8 billion) compared to £35.5 billion ($71.1 billion).

Net resources increased 8.6% to £30.6 billion ($61.3 billion), reflecting “an exceptionally strong balance sheet” and a central solvency ratio of 238%. The solvency ratio stood at 205% at March 19.

Mr Neal says the market will continue to focus on underwriting performance to improve the underlying combined operating ratio this year and will focus on reducing the cost of doing business.

Accelerating improvements through the Future at Lloyd’s project has also “never been more important”, he says.

Focus has been sharpened on prioritising market transformation initiatives that will see around 80% of business digitally supported, and work is being fast-tracked on claims processing improvements and building data and technology infrastructure.

“We are making the market more resilient, more successful and better placed to meet our customers’ needs,” Mr Carnegie-Brown said.