Hello, and good morning, everyone who's joining us for this MAPFRE full year 2025 activity results update. I'm here with José Luis Jiménez, CFO of MAPFRE, and Javier Fernández, who is the group's communication director. I'd also like to greet everyone who is following this online. I'd like to begin by saying that 2025, 2025 has once again been a wonderful year for MAPFRE, and I should underscore that we've exceeded all of our highest figures ever in premiums, in earnings, and in profit, which I think demonstrates the strength of our business model, as well as the technical discipline, the commercial excellence, and the successful application of our product and geographical diversification. It's basically the same trend that we've been seeing for the last few years, with continuous improvement, which has once again enabled us to post earnings.
Which well, in profit for the first time, above EUR 1 billion, and gross profit before minorities and taxes has, for the first time, exceeded the EUR 2.4 billion in profit before taxes and minorities. And all of this we have done in a complex environment, knowing that there could have been issues, because of these post-inflationary contexts since the pandemic and the complexity of trade globally with protectionist policies and tariffs. We weren't certain a couple of years ago when we started with this strategic plan, that the macro scenarios were going to be entirely predictable. But nevertheless, MAPFRE has managed to navigate successfully through this very complex world, and I have to say that it's actually wonderful time for insurance in general, not just for MAPFRE, but for the major global insurance companies.
We're benefiting from a favorable interest rate environment in most countries, which has enabled us to strengthen the value of our investment portfolios, basically for life, but also for non-life, as we will see later when we hear from our CFO. Essentially, also, we are benefiting from the absence of major global disasters as we had in the past and before the last 10 years. In these 10 years, we've not seen these major disasters with impact in the insurance or reinsurance sectors, 'cause they have happened, maybe, but not in geographies where there was a lot of insurance. But in any case, I have to emphasize that thanks to the work we've done internally in these last few years, we've seen a significant improvement in profitability.
A nd our profits have grown in spite of a negative impact, which is the depreciation of some of the currencies within our footprint. Usually, it was the dollar or some Latin American currencies, but in 2025, it was all of them. It was the real in Brazil, the dollar, the Turkish lira, and several Latin American currencies, which have depreciated versus the euro. And that has had a substantial impact on our growth figures, which, as we will see later, without this exchange rate effect, would have been even better. But we're very satisfied, and the strategic plan is going ahead on its third year, meeting its targets, and we're very satisfied because it has enabled.
Well, the board of directors approved the largest-ever dividend payout in our history, which I think is a way to reward our shareholders' commitment with our group. And we have to thank the over 150,000 shareholders of MAPFRE, who are loyal to us day by day. And I remind you that half the employees of MAPFRE in Spain, 4,600 people, are voluntary MAPFRE shareholders. So they will also be rewarded, on the one hand, because the share price has gone up significantly in 2025, but also with this excellent dividend that we have just announced. And the basic figures are these, as you know: over EUR 34 billion in revenue, that's 4% higher than the previous year. Premium, above EUR 29 billion, that's almost 4% more.
Attributable profit, as I mentioned, EUR 1.079 billion, with EUR 2.4 billion as net profit. The impact on premiums and revenues of currency depreciation has been over four points, so our growth would have been year-on-year even higher in constant currency, over 7%. As for technical progress, clearly, the Combined Ratio is really impressive, with 92.2%. That's almost 0.3 points better than last year. It's the best Combined Ratio we've ever had. Since we have records, it's the best, and it shows improvements in practically every line and every geography. In auto, which, as you know, was our weakest point for insurers since the pandemic in these last few years, that's also improved globally in North America, in Europe, in Brazil, and health insurance also, we've seen an improvement in combined ratio.
Auto is below 100 globally, and it's more than enough. Of course, we'll be able to improve it, but given the favorable interest rate environment globally, we're very satisfied. And our ROE was 13.3% without some one-off impacts that we had in 2024 and 2025 in like-for-like terms. But in any case, the accounting ROE of 12.4% is still excellent and in line with our target and our guidance, as well as the solvency ratio, which is for September. We haven't published the December one yet, because that's a couple of months later, but 210 is really good indeed. And I'd like to mention also, the great advantage for MAPFRE of its product and geographical diversification.
It's our biggest strength, and in these changing environments, it has enabled us to achieve a lot of flexibility within our strategic plan, so we can adapt to changing circumstances. Iberia, Spain, and Portugal, for the first time, with over EUR 10 billion in premium income, which is up just over 10%, bringing in EUR 450 million in profit, which is a very, very important number. Latin America, in spite of the Forex impact, is still one of the biggest drivers for the group's profit and revenue. Of course, particularly Brazil, because of its size and its contribution, which is once again achieving record figures. Net profit of EUR 680 million, and in the region overall, EUR 385 million.
So Latam, EUR 365 million, the best profit, the third best in history, but it would have been the best if it hadn't been for two bookings between November and December, which were pretty relevant and which do not really have anything to do with anything within Mapfre's control. First, in Mexico, because of some regulations that have required us to pass on to customers the VAT of claim processing, we can't deduct it. And in Colombia, as you know, in the month of December, on 29 December , there was a presidential decree raising minimum wage 23% in the country. And for MAPFRE, which has a run-off, a portfolio of insurance in that country, we're no longer selling.
It has had a significant impact, but overall, with Mexico and Colombia, it's been an impact of EUR 44 million, which we have provisioned appropriately in the months of November and December, and that's why the profit in Latam would have been even better without those two last-minute surprises. In North America, we're also really satisfied with our profit up 42%. EUR 139 million in profit, and we had seen significant improvements in the last three years, as we had shared. And of course, the weather was also pretty benign in the West Coast of the U.S. during this year, and that's helped. Then, of course, I have to speak about MAPFRE , which is our reinsurance and global risk units, which together have also achieved record net attributable profit of EUR 381 million, with over EUR 8,300 million in premiums, which is spectacular.
Of course, I do also want to mention the other two smaller units, MAWDY, which had a pretty standard but satisfactory year, and Solunion, which is a company we don't talk a lot about. That's our credit insurance company, but which has continued to grow with over EUR 350 million in premiums, earning over EUR 25 million in profit, with an excellent combined ratio of 81%. Really very satisfactory. These, earnings overall have enabled us to, raise our dividend. The board of directors discussed this yesterday, and they all agreed that it was important to raise the dividend to record figures. In the case of the complementary dividend or final dividend, 11 euros. The interim dividend, you'll remember, was 7 euros, and so the total dividend for the year will be 18 euro cents in all.
So that's EUR 554 million in total, respecting our target of a payout ratio of at least 50%. In this case, it will be 51.4%, and again, it's the highest ever dividend for MAPFRE, and we feel that it's a way to reward our shareholders for their trust in the company. In the last five years, over EUR 2.3 billion have been paid out to our shareholders as shareholder remuneration. Before I end and give the floor to José Luis, I'd like to remind you of something very important we've done this year, at the beginning of 2026, which was the change in our brand imaging. It's. We're happy with this investment, which was significant but really necessary. A global change of our corporate identity, a rebranding effort all over the world.
We've done it in different stages, depending on seasons in the different parts of the world. But it's a global rebranding, and we feel it's a more lively, fresher, more dynamic brand image, which I think better communicates Mapfre's identity, the way we are and what we do, because we want to be perceived as more honest, more clear, and more transparent than ever. We're focused on respect and empathy with our clients. We are building a more solid company, as you've seen with our earnings, closer to its customers, more modern, and close to those who trust us and to society. We're not just another company.
We are what w e do what we say, and you can see that in every aspect, not just of the business, but in everything that we do, from Tierra del Fuego to Beijing, from Boston to India, where, by the way, this week, we have been authorized to open MAPFRE RE branch. So the brand is really amazing. Our global presence and the identity that we're trying to convey with all of our to all of our stakeholders, it's really wonderful. And we believe that it's very important. We're not just selling insurance policies, we want to be there, close to our customers, wherever they may be, and we want to continue to look after what they care about. José Luis, we will, I think, now move to the numbers, if that's okay?
Yes, Antonio, and good morning, everyone. Well, the main global figures that the chairman has shared, I will describe the financial highlights of the year using the standardized accounting standards for insurance in each country. This is our consolidated revenue, EUR 34 billion. That's over EUR 1 billion more than the previous year, up 4%. Premiums, up 3.6% in the year, with over EUR 29 billion, in spite of the Forex impact. Falling interest rates, as the chairman has pointed out, particularly compared with 2024, have had an impact on our growth figures, particularly because of the depreciation of the Brazilian real and other Latin American currencies, and the Turkish lira, and the American dollar. In constant currency, premiums would have gone 8.something%, and that consolidates the profitable growth strategy that we have been deploying.
Non-life premiums, EUR 22.4 billion, while life premiums are close to EUR 6.7 billion, up 1.5% and 11.6% respectively, or 6% and 14.7% with constant currency. Our gross financial revenues, EUR 3.1 billion. That's our trading gains. That's 4.2% more than the previous year. On the right, you have the breakdown of the different lines of business, all growing significantly, particularly life savings, and in a context in which we're focusing on driving our financial business. I'd like to dwell briefly on the evolution of our combined ratio in our main business lines in the last three years. General Insurance, with 80.2%, has an exceptional combined ratio, down almost 0.7%, due to our technical rigor and the absence of relevant catastrophic disasters.
But what's relevant is the great stability of the last three years, with across-the-board improvements in all markets, and Brazil is currently the most outstanding in technical profitability. Auto s till showing improvements in the ratio and back to profit with 99.8%. And so we are meeting our guidance of reaching technical balance that we announced a few quarters ago, with an improvement in every market, but especially in Iberia, where it's 98.5%. That's almost seven percentage points below the previous years. Health and casualty also shows very positive performance, with 98.3%, with Iberia 94.2. And finally, life risk is still pretty stable, with very profitable levels of 85%. So overall, our combined ratio is well below 95%, and therefore, improving upon the guidance we gave in our strategic plan.
And here you can see the breakdown of premiums and profit per region and business line. Iberia, Spain and Portugal, 10% up, with premiums above EUR 10 billion already, and for the first time, also, EUR 3 billion in life premiums. MAPFRE Spain, still leading in its main lines in that market, with a profit up 22.7%. Latin America is still one of the main contributors in terms of premiums and profit, the group's profit. Brazil, of course, is the most important market, with almost 45% of the total. In fact, Brazil continues to post very solid figures, and it's already above EUR 268 million in profit, with an excellent contribution in terms of technical profit and also financial profit.
In the rest of the countries in Latam, premiums are up 3.4%, while net profit was EUR 97 million, impacted by unexpected fiscal regulation changes in Mexico and administrative regulations in Colombia, which have subtracted EUR 44 million. In North America, premiums $2.6 billion, impacted by the depreciation of the dollar, although the non-life combined ratio has improved to 95.4. That's 3.3 percentage points below the previous year. The profit line shows an outstanding improvement, with almost EUR 140 million because of the excellent performance of the U.S. business. MAPFRE RE premiums grew slightly, up to EUR 8.3 billion. Both the reinsurance and the global risk businesses are performing well in terms of profitability. As for profit, MAPFRE RE has obtained record profit with EUR 381 million.
That's 70.2% higher, bolstered by the absence of catastrophic disasters in the year and the profitability of its investment portfolio, with an increase in its trading gains of 17%. On the right-hand side, you also have the positive contribution of MAWDY, our assistance business. I'm going to go over the main aspects of the balance sheet briefly. Total assets, up 2.7%, reaching almost EUR 67 billion. As for shareholder equity, it's EUR 8.9 billion, which is up 5.3%, thanks to the major contribution of the profit and the improvement in unrealized net capital gains in the available-for-sale portfolio, which have offset most of the currency, the impacts, the negative currency impacts, mostly due to the depreciation of the US dollar.
Our investment portfolio, also bolstered by the growth of the business and an improvement in the fixed income portfolio valuations, up 5.8% at over EUR 48 billion. Most of the portfolio is fixed income assets and similar assets, with over 82% of the total. On the right-hand side, you have MAPFRE's position in sovereign debt, with almost EUR 23 billion, of which EUR 9 billion are invested in Spanish sovereign debt. As for assets under management, we are making significant progress, with major increases in pension funds, 8%, in spite of regulatory changes, while investment funds have increased by 32%. We've exceeded the 16 billion dollars, the 16 billion euros under management due to net underwriting and market effect. But it's important to emphasize our goal to become one of the leading companies in financial planning in Spain.
We should also emphasize the excellent performance of our asset management company in Brazil, MAPFRE Investimentos. Before I end, I would like to take advantage of this opportunity to remind you that the group of insurance, listed insurance companies have been following the IFRS standards, and these are the figures for the MAPFRE Group under these new accounting standards and their comparison with local accounting standards. I'd like to remind you that the IFRS consolidated accounts are available to you in the MAPFRE website and in the CNMV. Premiums are no longer considered an accounting item on the IFRS standards, but they are seen as revenues of the insurance service. Net profit is EUR 1.3 billion, that's up 17.1%. On the other hand, attributable equity is up to EUR 9.4 billion, that's up 5.9% versus the previous year.
Our Contract Service Margin, which reflects the deferred profit of multi-annual policies, is up 3.9%. The rest of the items grow in line with the performance of the business, and as you see, both trends are well aligned in both, accounting frameworks. To end, I'd like to refer briefly to the trading performance. Our shares have appreciated by over 75% in the year, tripling the EURO STOXX Insurance Index , which groups most of the main European insurers. As you see, our share price has appreciated well above the, IBEX 35 Index, which went up 49.3%. It's true that there was a bit of a slump, but that has disappeared in the last few weeks. And that's all from me, Antonio. You, I'm going to give you the floor back.
Thank you very much, José Luis. As I've pointed out, we are coming to the end of our strategic plan, which, when it was designed initially, it had some significant uncertainties in the scenarios long term, which made we felt we had to be very conservative and very cautious, and move forward with our model, while guaranteeing the technical profitability of each of our businesses and trying to prevent taking on obligations that might be an obstacle in the future. In this sense, I think this year's earnings demonstrate how well we've executed this strategy all over the world with these earnings. Even if we had had constant exchange rates, as José Luis has explained, we would have grown even more, if exchange rates had been more constant, we would have seen an even greater improvement in our premium growth, exceeding all of our targets.
But if we look at the current results in line with the plan. Working on the parity ratio. At the end of the plan, we expect that at least 36% of leading positions in MAPFRE in the world will be occupied by women. So by way of conclusion, we, I would say we can face 2026 in a very solid position, and we're absolutely certain that with these numbers showing a robust and diversified business model that can generate value even in complex environments, we will be in a position to serve through a magnificent 2026, maintaining our same engagement with our shareholders, with greater dividends for 2025, and hopefully also for 2026, since we're absolutely certain that we can enhance the reward to our shareholders as our performance keeps improving.
The technical capabilities continue to strengthen in all business lines in all countries, which only goes to show that the decisions that we implemented in the past few years were the right decisions after the way the COVID pandemic shook the insurance world. And of course, sticking to our strategy plan with great execution has brought us to this position. I was talking about the new branding change. We want to continue to be a very up-close and urban company. Only in Spain, where the rebranding campaigns we've been running for approximately one month, considering the population over age 18, over 80% of Spanish citizens have perceived the change in branding under a positive light.
Today, we're publishing our data, our commitment as a company to enhance our return to shareholders with better performance, better businesses, and we just proved how we sailed through the 2021, 2022, and 2023 crisis in the auto world that led to ratios we did not consider acceptable. We're ready to continue on. We're working a lot on digital innovation and transformation, creating value wherever we are. Every year, we invest over EUR 1 billion in digital transformation and technology across the world to enhance our efficiency and become more and more competitive with a better client experience. Just a few numbers on AI, for instance, 126 AI solutions already deployed only in Spain. That benefit more than 6 million clients, thanks to AI solutions.
Eight out of ten MAPFRE clients are already perceiving the advantages of AI in their interaction with us. The culture, the brand, the technology, the strategy are all making a contribution to these magnificent numbers we just showed you on screen. On to the next part of the presentation, Javier?
Yes, welcome once more. We cannot see you very clearly, so if you'd tell us who you are, please raise your hand and come to a microphone and state your name.
Hello? Well, good morning. First of all, congratulations on the change of brand, and I completely support the small cap font you've been using. So my question, last year was very good in terms of the absence of disasters, but this year had a bad start with the floods in Spain. Do you believe that this might somewhat slow down your expectations for this year in terms of profit? Second, a large Spanish bank has gone into Latin America with a strong presence. Does your strategy for North America contemplate this? And also Brazil. Well, some people keep claiming that Brazil is still heaven and haven. Is that true?
Well, I'll start by the end. Brazil is a magnificent, impressive country. I don't know if we can call it being in heaven, but, of course, in economic terms, which is, I understand what your question is about, has been shaken slightly in the past couple of years. They're going through a political cycle, and as you know, political cycles in Latin America are pretty much like football. They're very intense and emotional, and we do see that there is a potential for a change in the political cycle. There are elections on the horizon, and therefore, the economy seems more intense. But the Brazilian economy is resilient. Interest rates stay around 15%, with inflation verging on 6%, so, it's the country with the highest actual interest rates in the world.
So we're contemplating that in our investment portfolios, but we also see a reduction in sales f or insurance, but this affects the entire market. But we're still very positive about Brazil. It's an enormous market with huge technological potential, great consumer potential too, and a population that is very likely to continue to enhance their life standards. We're with capacity to keep growing and help us become and remain one of the leader companies in that country. About our strategy in North America, well, it hasn't changed. Of course, we're following the news, and we're glad that Banco Santander continues to invest in the U.S. We're still present in the East Coast with our MAPFRE USA brand.
Well, it used to be Commerce Insurance within, the MAPFRE umbrella, whereas now they're a very powerful local company with an important share, both in auto and home insurance, and one that continues to grow in a very competitive market. We're aware that large American insurance companies have gone into that area, states that they had been perhaps neglecting. But we're still there. We're enhancing our distribution policies. And you were talking about disasters at the beginning of the year. Well, yes, we do live in a complex world, and disasters do happen. Maybe in 2025, we didn't see that much intensity, and although we're not talking about a weather event, we still had the California wildfires in 2025 that affected insurance companies greatly.
But since the rest of the year was more benign, we could somehow offset those difficulties, and that is why we had such a great performance last year. And now about the floods in Spain. By the way, a message of solidarity to all those affected by the Grazalema, Ubrique, and Extremadura floods, where the top two dams in Spain are being drained to face oncoming rain that might affect the whole banks of the Guadiana River. But in terms of insurance, I don't believe this will have such a relevant impact on MAPFRE as a business. Remember that we have the Insurance Compensation Consortium, so all the damage coming from floods, as we saw last year, is covered by the consortium. So we're already meeting our obligations to our policyholders.
I believe last month we had approximately 40,000 claims that we're already working on, and we don't believe MAPFRE will be terribly affected by this claim ratio. Obviously, as citizens, we're concerned about the intensity of the storms that are hitting our territory and affecting so many people living in Spain, not only in the south, but all over the country.
Thank you very much.
Hector? Well, maybe you first. You first.
My name is Carlos Rodriguez from El Confidencial. Assets under management, I can see that those have gone up by 9%. What's the cause of this, beyond the good performance in stock market?
Well, Spain is focusing on becoming a reference point in assets under management. We hold nearly EUR 40 billion in assets, and sales network in Spain were recently modified in terms of structure that will become a driver for this year and oncoming years, and over 1,000 agents qualified to sell insurance savings products in Spain. So on investment funds and pension funds, we must remember that with a growth of 8%, we're the fastest-growing asset manager, despite an unfavorable environment. So we're still working on that side through a vast network of over 3,000 offices. We're close to the ground and to our clients. That provides differential growth potential for the next few years. In the case of Brazil, also, MAPFRE Investimentos has had spectacular growth, exceeding 30%.
As our chair was pointing out, with growth rates exceeding 15%, it's only natural that people will want to invest on fixed income, which gives us an advantage in that area. The fact that you can manage your own balance, your own money, generates a conversion effect that's very reassuring for clients. We manage our investment funds to invest ourselves, and we're clearly invested in those investment funds, and that generates a lot of reassurance when compared with other possibilities in the market.
Next, Hector. Now, Hector, go ahead.
Hector Caballero from El Economista. Well, first of all, as part of your strategy plan, there was a point I recall, and I don't think you addressed it, growth in premiums. I think you wanted to grow by EUR 32 billion this year. But considering the present numbers, that entails a growth rate of about 10%. Have you are you considering that milestone as unreachable, or do you still think you could make it? And second about the previous question on North America. Considering the lawsuit you have with a partner in Massachusetts, do you think that might affect your relationship with that partner in the state of Washington and Idaho, with whom you signed a contract in 2021?
Well, thank you, Hector. About our public commitment on premium growth, we never gave any absolute value numbers. Somebody may have spread a number, but we haven't published anything. We're considering average growth of 6%, but that average growth is not being met right now at actual exchange rate, but we're hitting 7.8% in actual exchange rates. So in that sense, we are reaching our numbers, and we're only talking about life risk, and that does not include savings. So the growth in premiums is actually exceeding our public commitment, as in the past two years. As for our forecasts for this year, well, they haven't changed, and we're satisfied about them. We do understand that there will be some tailwinds and exchange rates in 2026.
The macro environment is likely to stabilize in important countries like Mexico and Brazil, and the United States of America, and that will bring the appreciation of some of these currencies in 2026. As for the lawsuit you mentioned, yes, it was a measure MAPFRE adopted with a relevant distributor in that country, present in Massachusetts and other states on the East Coast. Well, Mapfre's position is just demanding contract compliance, which ended in late 2026, which it just pulled it backwards one year, and it was perfectly factored into our plans. We had an exclusive partner, not a shared partner, because we Motor Club AAA will continue to distribute insurance in that region of the U.S., and they will continue to do so.
But in terms of portfolio protection, we decided to legally claim contract compliance to have Mapfre continue to manage that portfolio. Up until now, we had an exclusive agreement with this distributor. In Washington and Oregon, we have a joint venture with in the U.S. managing Mapfre and consolidating with Mapfre. AAA in the U.S. is a federal organization, and one or several states group federally, and they're completely independent or autonomous. So auto insurance can be shared, but ultimately, institutions are completely federal and autonomous in their decision-making. And the development of that new, very small joint venture is following a very positive trend.
Hello, this is Rafa Sierra from Seguros News. You've grown your revenues, you've grown your profits significantly, but your salary has come down. Why?
Mine specifically, you're asking, Rafael. Well, my salary did not actually come down. It went up 4% and a bit. But in the reporting that is required by the CNMV, you have to include all the bonuses and other incentives that accompany my salary. And the pension contribution, in my case, based on my contract, went down from the age of 60, actuarial age of 60, which happened a while ago. My pension contribution went down. So combining the total, it looks like I'm earning less, but a nd also, the system that insurance companies and banks, too, have, as you know, includes some short-term incentives, some long-term incentives, which are then deferred over several years.
In my case, as chairman, I have a very long-term deferment plan, so I have to wait several years to receive some of the bonus that I'm earning, which is why sometimes the year-on-year comparison is not that immediate. But in any case, my actual salary plus my yearly incentive has gone up 4 and a bit%, as you can see in that same report. But in any case, I'm quite happy with what I'm earning, and especially with how well MAPFRE is doing.
Great. Miguel, here in the front. Miguel?
Yes, good morning. I'm Miguel Moreno Mendieta from El País and Cinco Días. I have two questions about the share. Which is true, at the beginning of the year, there was that one day with the UBS report, where there was a sharp drop in the share price. I think it was 9% slump. Then this week, not just MAPFRE, but the whole industry, has had a significant slump, with a couple of reports mentioning a very small Spanish companies called Tuio, which has an application in ChatGPT, and that that could endanger the business model of the traditional insurance companies. I was a bit surprised because Tuio is a tiny company, but some major investment banks in the U.S. have been referring to it.
Thank you, Miguel. The question about the share and so on, I leave to José Luis, and I'll answer your second question.
Well, the world right now is a bit uncertain, I would say, and suddenly some news because of algorithms and robo-advisors and automation of a lot of stock trading, all of a sudden there's a story which is sometimes not really accurate, but just a rumor. Suddenly, that triggers market fluctuations, which sometimes make you laugh and sometimes make you embarrassed to be in this world. But in this case, I think, what happened was this app uses AI models to try and simplify and facilitate the user experience in the purchase of insurance products, which we welcome and we hope will be successful because it will definitely help to make access to insurance, particularly simpler insurance products, even more, available to all those people who, like AI, who believe that it's here to stay.
A nd that it's gonna be part of our lives forever now, and that it will simplify decision-making in some areas. But of course, in-person advisory services, as MAPFRE provides with agents and brokers and other types of distributors, will continue to be the model recommended by insurance companies like MAPFRE. But these people, these, developers, what they're doing is to distribute. They're never going to replace insurance companies. They're distributors. It's just another distribution channel, and with them or whomever in different parts of the world, we will talk in order to decide whether we want to work with them if they are a good channel to facilitate access to insurance.
So just remain calm, and we hope as many channels as possible will be available to reach the underinsured, particularly in Latin America, making it easier and cheaper for them to access insurance. We will always welcome such steps. As for the report you mentioned, I think it's a great report. It's really well-written. UBS is a great company, and we probably agree in a lot of the things they said in that report. On other things, perhaps we might see things differently. And one of the things that has had a bigger impact, and I think there, there's been a bit of pessimism, had to do with currencies in Latin America and the dollar, too. There's two effects here.
It's the first time that we've seen in the last 20 or 30 years that the dollar and the Latin American currencies have not provided a perfect hedge, 'cause when some went up, the others went down. But this time, probably given the U.S. administration's policies to weaken the dollar, we've experienced a shock which maybe the financial industry was not expecting, and that has impacted us. It's not the same to grow 4%, which is what we have in euros, and to grow 8% in local currencies, which is what we have. But what matters is the outlook, and the outlook has a lot to do with the region, Latin America.
And I think a positive surprise and something that could help us a great deal in 2026, is the fact that Latin America is currently one of the regions which the most favorable outlook for this year. We've seen that other firms like Citibank or Morgan Stanley or the Institute of International Finance , are predicting from Latin America, a very positive outlook. It's been just a month and a half into this year, but we're already seeing a significant appreciation of the currencies of some Latin American countries, so that could be a tailwind unlike what happened in 2025. Some countries, in the case of Colombia, we've had an impact because of the raise in minimum wage, but also a more favorable context in terms of interest rates.
In those countries where we sell insurance policies linked to credit, if the Fed brings down interest rates 30 or 50 basis point, and that enables them to bring theirs down, Brazil, which is currently the strongest market with 45% of the premiums, as we mentioned, if the rate, instead of being 15, comes down to 12, that will drive economic growth and investment. Why are we optimistic? Just to give you a figure, in January, inflows into the São Paulo Stock Exchange exceeded, in one month, those of the whole previous year. So a positive commodity cycle, plus, an American administration more focused on Latin America, promoting trade and imports from that region, I think benefits Latin America in outside major geopolitical conflicts, and that could benefit MAPFRE.
We have a question that's come online from Mireia Merino from Reuters, which I think has already been answered, but I'll read it out in case you want to add anything. She's asking about the fall of share prices in the sector and the concern about AI, and, the use of that app in ChatGPT. What do you say about investor concerns that AI could, significantly impact traditional insurance distribution models? And whether the s he's asking, these tools are a threat or an opportunity, and how you're integrating AI in MAPFRE, and what savings targets do you have?
Well, that's a very broad question, and I had answered most of it, most of it already. We don't feel any concern. Quite the contrary, we, I admire the InsurTech sector, which is trying to innovate and open new distribution capabilities to reach a broader audience, and I think that's very positive. And for an omni-channel, omni-product company like MAPFRE, which works in such complex environments in populations sometimes that are significantly under-insured. Because here in Spain or in Europe or in the U.S., it's easy to buy insurance, but there are countries where the presence of agents close on the ground with the right products for less developed populations or less under-insured populations is more difficult, and there AI can be very helpful. And technology has, for several years now, helped enormously in insurance distribution.
We think it's normal now to use online comparison tool or platform to compare prices between different insurers, and I think AI will simplify these processes even more. But these will be benchmarks or comparisons which will also produce recommendations, and of course, they will have to be a bit careful in terms of, supervision because advisory services are regulated and must comply with the right standards to make sure there's no mis-selling, and there's the right specialized, advisory with enough knowledge and expertise to protect the rights of consumers. In MAPFRE, we are integrating AI, as I mentioned, and now in a lot of our back-office operations, but also in front office. In our contact centers, we already have solutions that are helping, always of course, notifying customers when AI technology is being used to simplify and facilitate the development of that interaction with them.
In MAPFRE, as you know, we were the first insurance company or IBEX-listed company in Spain and in most of the world that published its own manifesto on AI a couple of years ago, expressing our belief in the importance of human supervision and control of these technologies, and the importance of using it always with the same ethical principles and values that MAPFRE uses for all its business models, to try and always to guarantee privacy and protect the rights of consumers, who, of course, have the final say on any purchase and on their loyalty to one or other channel or business model. As for savings, it's really difficult to quantify. As you know technology, I say we are investing annually over EUR 1 billion overall in technology as a whole.
Of course, now we are experiencing significant disruption in technology platforms that already integrate AI. We have a global platform project for a platform called Reef, which is already being deployed in seven or eight countries, including Spain, Portugal, and Brazil, and where we're trying to accelerate deployment. These are cloud-based technologies, so there's no physical deployment or client-server deployment in the countries, and so the deployment is a lot simpler. And with AI solutions, you're able to accelerate this simplification and improvement of processes for customer interaction. But it's difficult to quantify the impact, but we will continue to deploy these technologies, and if we can reach agreements with companies that can provide these technologies, we'll be delighted to do so.
Thank you. Manuel Chicote has the floor, and then Adma.
Yes, I'm Manuel Chicote from Aseguranza, and I have two questions. In the last few years, insurers have been increasing contacts to develop new distribution models. You've signed one such agreement with Carrefour. Could you give us more details about the objectives of that agreement and to make sure there's no overlap? And second question is, have you already achieved y ou've already achieved a combined ratio under 100 for auto, as has, I think, the industry in general, according to the January figures. Is there going to be a new price war, or what can we expect from the auto business for 2026? Thank you.
Well, the auto business. Well, sorry, Manuel. If you mean Spain, that's a market that's very different to Brazil's or the US, so we experience very different circumstances. I know it's hard to compare MAPFRE with solely Spanish insurers, who are focused on growing more in Madrid than in Barcelona or more in Coruña than elsewhere. We're concerned with growing everywhere, from Boston to Turkey, Turkey, as I said before, from Argentina all the way up to Mexico, so everywhere, and in Spain as well, of course. So we manage this in a very technical and complex way. We've never spoken about price wars. We speak about sufficient and adequate prices for customers. We don't promise to be the cheapest company, and we never will.
What we promise is to be the best company at the best price with the service the customer expects. We don't think it's good to cheapen the concept of auto insurance or any other insurance. It's a very complex, very delicate product. The third-party liability aspect is very significant, and the risk the insurer incurs, but especially the customer incurs if they're not properly insured because of bad advice, is significant. So that's why the price has to be customized based on the customer's individual circumstances, so we can offer the right coverage to always be protected. In the case of new distribution models, MAPFRE has focused on being omni-channel. I mean, if we could, we would have channel agreements with everyone.
We're always delighted to bring in new partners like this, retail distributor or Carrefour, you mentioned. It's just for Spain, but it's very important. It's a lot of supermarkets through their stores, and they have a customer club with a very large number of customers to whom they will offer life and non-life products, simple products, with the quality of MAPFRE products and our availability to provide service, and the strength and the success of Carrefour. For retail distribution, we think that this is going to be a very successful agreement. It's a long-term agreement, an exclusive agreement, again, and we have our own internal forecasts together, but we don't publish them, and we just expect that gradually, as Carrefour develops those customer services, including distribution and advisory insurance, they will be very successful.
There's no overlap or conflict with our own distribution channels. Our project to continue opening new brand offices continues. As we announced, we want to open 300 more offices in three years, and we'll broaden that a bit and be close to our customers with our own model, with our own brokers and agents, but also with our banking partners, Bankinter and Banco Santander, as well as many other distribution partners we have in Spain and elsewhere in the world.
Thank you. David, please.
Yes, hello, I'm David Leonor from Boletín Diario de Seguros. I'd like to ask two things. First, in the documents you've sent to the CNMV, in the breakdown of the results in Spain, there's a significant drop in the life profit. Could you explain why that is? And second, as for the goal José Luis mentioned, of becoming a leading company in asset management, does this strategy also involve life insurance? Because if g iven the figures of the last few years, it seems it's easier to sell pension funds and investment funds than life savings policies.
Thank you, David, for those questions. As for the first, it's true that last year, MAPFRE Life sold a building, and so that brought in significant capital gains because occasionally we rotate buildings in our portfolio, and that generated a one-off, which drove profit up in the year, and so the year-on-year comparison is not like for like. The second question is very important for us because in financial planning, you can't really talk about product. You have to talk about service, which is what the customer needs and not what you want to sell them. I think that puts us in a very different position versus most of our peers.
So our great advantage, with a network of over 3,000 offices and with very committed teams, is that we really know our customers well, and they may need a unit-linked , or they may need an investment fund, or they just might decide to buy shares or bonds with us through MAPFRE Inversión. All those possibilities are there, and I think we have the financial platform, according to Apple standards, that's most appreciated by customers because it's easy, intuitive, and it includes all of our financial offering. And insurance may have an advantage because you could maybe invest in an investment fund and then accumulate some savings for my children long term. But it might make more sense if it's unit-linked , because apart from the investment component, you have a protection component.
And in this part of pensions, which we mentioned before, where we're very satisfied, not with the total volume, because we think the third pillar is something that needs to be relaunched, and that minimums will have to go up because there's very little saving into the third pillar. I would say that it's not nonexistent, but it has become much smaller than it should, particularly compared with other European countries, and the second pillar is not very developed either. So in this part, saving for retirement, we need to save more. And a very important thing when people save and then get to retirement age is guaranteed income, and so it really depends on the specific needs of our customers.
And so you need to have the whole range of products and services for them, and I think that's a great competitive advantage that we have. And often, and this connects with previous questions, technology helps us a tremendous amount. Being able to buy shares from anywhere in the world through the app is amazing, but I think the human touch, having an advisor who can help you, advise you, guide you through a complex world, like, equity markets or insurance products, is really valuable, and that's really one of the great advantages we have. An office less than 15-minute walk away, any part of Spain, has extraordinary value, as we've seen with some of the disasters in Spain last year, unfortunately, where having an office there has really helped people.
And so this combination of physical presence and technology, the human touch, is one of the things that clients really appreciate.
Any other questions? Yes, there in the back. I couldn't see you. Sorry.
Hello. Unai Mejut. This is a more general question. The EC recommended European states to set up tax benefits like the one applied to pension plans in Spain right now. Have you estimated or calculated how this might affect your asset management if it comes to happen?
Well, thank you, Unai. We are working on it with the different authorities. We have a task group working on it, and we think it's a fantastic solution. That kind of account that can have several different underlying assets and favorable tax conditions should be approved at a European level, because in that case, we could mobilize the savings we have in, say, current accounts or deposits to make it productive. We all remember the Draghi report and how important it is to invest, well, in the case of Spain, invest in EUR 1 billion in assets to mobilize the economy. That economy mobilization will generate an increase in innovation, productivity, and employment. And insurance companies have a competitive advantage, vis-a-vis other financial intermediaries, because most assets managed by insurance companies are invested in the region where we operate.
If we consider any financial intermediary and compare them to an insurance company, insurance companies invest 70%-80% of their fixed income portfolio in their own region, in their own currency, compared to other players who might invest in other currencies across the world. So I believe it is important to get that legislation approved as quickly as possible, because that would have serious implications for Europe in terms of local investment to support the industry and employment plans. In terms of a tax benefit, well, it is well known that tax benefits mobilize savings, and if that's the ultimate purpose, as the Draghi report suggested, it would be beneficial for all those involved.
Next, Elisa Del Pozo from Expansión. You said that you're investing about EUR 1 billion a year in transformation and digitalization, and you expect to continue to do so. So when does that start counting? EUR 1 billion a year, was 2026 the first year, or was 2025 the first year, or how is that going to work? And then your plan for opening new offices. I mean, how many offices of MAPFRE are functioning? And last, I would say Germany and Italy are the sole businesses resisting with a combined ratio exceeding 100%. So do you have any plans on when you will meet or when, when that situation will stabilize and when you will come down off that 100%?
Well, I will address that technology investment you mentioned. I'm talking about total investment to get MAPFRE to work under innovation and transformation every day, and that investment didn't start two years ago or five years ago. It started, it dates back to, the very existence of technology. You're all too young, but MAPFRE was the first company to invest in a large central processor to issue insurance policies, and we're talking about 50 years into the past. The automation of our sales network, the whole technological transformation that has brought us to this point in all businesses and services, always adopting state-of-the-art technology. We have one of the most advanced systems in the world to facilitate, service to our users, and that's all part of that annual investment process.
So the whole technology transformation entails large cloud investments to evolve the platforms you've already heard about. Our investments in innovation and development of new solutions are also included there, as well as AI, an investment that will continue to grow with the business. Unfortunately, as managers, we tend to think that technology will eventually grow cheaper, and it never does. It just enables us to run more transactions at a lower cost per transaction if we can actually ride the wave of scale economies. If there are no scale economies, technology is always very expensive, but it's up to us to realize when a project can go on or must be dropped. Certainly, we need to work on the profitability of our platforms to balance costs.
As for the number of offices, well, we published our numbers in Spain. We have approximately 3,200 offices in Spain. We based this on a three-year project, and even in the past, we had a five-year project to optimize the number of offices we had at the beginning of the strategy plan. So there are plenty of new offices opening. Others are closing because the areas where they are are no longer or no longer justify their presence in those regions. So we're very satisfied with our strategic plan, and we still support the local office project for small villages with under 1,000 inhabitants will benefit from a MAPFRE office closer to the ground, closer to our clients, so that they don't have to drive 20 minutes to the next large city center.
And about Germany and Italy, well, they're also part of the EMEA region, which also comprises Turkey and Malta, and the region has substantially done better in the past couple of years. In Turkey, even if our combined ratio is over 100, interest rates also exceed 30%. It feels a little bit like Brazil. I mean, the combined ratio in Brazil is 100 or 101, but interest rates are 15%. In Malta, we have a highly diversified business, both in life and non-life, and it functions like clockwork, and that has provided very predictable outcomes for the group. We also have single-brand companies in difficult markets, but improvements in Italy and Germany are substantial.
Only last year, the combined ratio went down by 15% in all of EMEA, and in Italy, which had a serious crisis in the auto industry, there's been a 20-point reduction in only one year. So we can only expect Italy and Germany to do better. Probably, it'll work faster in Germany and, but we're also working on it in Italy. We're talking about single-product companies, and compared to other more difficult areas, they're still stabilizing, but I'm sure we will come to a sound balance very soon.
Okay, so this would be the end of the Q&A session because we have a session with analysts later on. I do remind you that we have some coffee, a coffee break outside for you, and do remember that we have a Anders Zorn exhibit in the MAPFRE Museum. He's a Swedish artist that we will have in a magnificent exhibit in the MAPFRE Museum, and there are tickets for you if you're interested. Thank you very much for attending this earnings call, and see you around coffee in a couple of minutes. Thank you.