Both Kodak M550 and Olympus XZ-2 iHS have 12.0 MP resolution sensors but Kodak M550's sensor is 1/2.3-inch (6.17 x 4.55 mm ) and Olympus XZ-2 iHS's sensor is 1/1.7-inch (7.44 x 5.58 mm ).
Since Olympus XZ-2 iHS's has a larger sensor area with the same resolution, this means that it also has a larger pixel area hence better light collecting capacity for a given aperture compared to Kodak M550.
Below you can see the M550 and XZ-2 iHS sensor size comparison.
As seen above, Olympus XZ-2 iHS has a 1.5x Larger sensor area than Kodak M550. Larger sensors give photographer more control on the depth of field and blurry background compared to smaller sensor when shot in same focal length and aperture.