Lloyd’s earnings fell 9.9% in the six months to June 30 as investment returns slumped.

Profit was £1.38 billion ($2.36 billion), down from £1.53 billion ($2.62 billion) in the corresponding period last year, while investment returns fell to £247 million ($423 million) from £619 million ($1.06 billion).

“All large investors, including major insurers, have found it hard to secure meaningful returns in the continuing low-interest-rate environment,” Chairman John Nelson said.

“Yields at longer maturities have begun to rise in anticipation of tighter monetary policy, but short-term interest rates are likely to remain very low in the near term.”

Lloyd’s gross written premium grew 4.9% to £15.5 billion ($26.6 billion), while the overall combined ratio improved to 86.9% from 88.7%.

The market benefitted from the absence of major catastrophes in the six months.

Mr Nelson says there are signs of slow economic improvement in the UK and US, but conditions remain challenging in parts of Europe and growth rates in emerging countries have eased.

Capital from outside the industry is also putting downward pressure on premiums.

Lloyd’s CEO Richard Ward, who is leaving at the end of the year, says the market has made good progress towards obtaining an onshore licence in Turkey.