Manulife Financial's Earnings Improve


Canadian life insurer, Manulife Financial Corp. (MFC) reported first-quarter 2013 net income of approximately $536 million (C$540 million), declining from $1.2 billion (C$1.2 billion) in the last year quarter.

The quarter saw solid core earnings and strong investment gains. However, negative interest rate-related impacts were the partial offset.

Core earnings of Manulife of $614 million (C$619 million) were up 17.7% year over year.

It was primarily led by lower new business strain, lower amortization of deferred acquisition costs and lower expenses. However, unfavorable claims experience was a partial offset.

During the quarter under review, Manulife’s Insurance sales decreased 23% year over year to $614 million (C$619 million). Lower sales in Asia and Canada attributed to the decline.

Wealth sales for the first quarter were $12.3 billion (C$12.4 billion), up 43% year over year. The increase was due to more than 100% improvement in sales of Asia Division, along with 45% improvement in U.S. Division's sales.

For wealth products, premiums and deposits of $16.2 billion (C$16.3 billion) increased 42% year over year.

Insurance premiums and deposits increased 7% year over year to $5.9 billion (C$6 billion), reflecting strong growth in Asia, Canada and the U.S.

Manulife generated new business embedded value of $299 million (C$301 million), in line with the first quarter of 2012.

The company strengthened MLI’s MCCSR to 217%, up 6% over the prior quarter.

Funds under management reached another all-time record of $545 billion (C$555 billion) as of Mar 31, 2013, driven by positive net policyholder flow.

While StanCorp Financial Group Inc. (SFG) and Reinsurance Group of America Inc. (RGA) reported operating earnings ahead of the Zacks Consensus Estimate, Protective Life Corp.’s (PL) earnings fell short of the Zacks Consensus Estimate.  

Manulife currently retains a Zacks Rank #3 (Hold).

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