Desjardins Financial Security reported record earnings for the year ended Dec. 31, 2005.

The life and health insurance arm of Desjadin group said earnings for 2005 were $159.7 million, with continuing operations providing $154.4 million of that amount. That represents a 22.7% increase over results the $130.2 million at this time last year.

DFS said certain non-recurring items, such as the sale of the company’s Imperial Life division in the Bahamas and the settlement of several major non-performing loans, had a favourable impact on the year’s results.

DFS also benefited from the fact that a $275 million debenture, issued on Dec. 30, 2004, did not bear interest in 2005. This debenture was converted into preferred shares on December 31, 2005.

Insurance and annuity premium income grew by 10.1% in 2005, increasing from $2.1 billion to $2.3 billion. Assets under management rose 15.3% over the past 12 months, exceeding $17.2 billion at Dec. 31, 2005.

Operating income stood at $184.9 million. Without the impact of an actuarial expense in 2005 for future income tax discounting and a positive non-recurring item associated with the value of an investment recognized in 2004, the company’s operating income would have totalled $202.9 million, compared to $178.0 million in 2004. This 14% increase was due mainly to good claims experience and investment performance.

President and CFO of DFS, François Joly commented: “Despite the context of consolidation in the financial services industry, our net earnings have grown by 101.6% over the past three years and we have more than doubled our return on shareholder equity. These results clearly reflect our company’s vitality and strengthen our capacity to consolidate our growth in a highly competitive environment.”