Lloyd’s has returned to profit after two straight years of losses, with the reversal attributed to the investment performance, rate increases and improved underwriting discipline.

Pre-tax profit rebounded to £2.5 billion ($5 billion) last year from a loss of £1 billion ($2 billion).

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.

CEO John Neal says that while he is pleased to be announcing Lloyd’s return to profitability in 2019 and continued progress in its Future at Lloyd’s strategic plan, “our primary focus right now is on supporting our customers and business partners in their time of need”.

“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.”

The market has asked for market feedback on expected losses related to the coronavirus pandemic and is also taking action to mitigate asset portfolio volatility.

Chairman Bruce Carnegie-Brown says the value of assets held by Lloyd’s to pay claims has been subject to the significant volatility experienced by global financial markets.

“The corporation is monitoring these changes in asset value and has a plan in place to mitigate risks to the asset portfolio,” he said last week, as Lloyd’s released its annual results.

“[Lloyd’s] 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 event.”