Manulife’s Q2 net income halved as insurer struggles with impacts of COVID 19

By Tara Deschamps


TORONTO _ Manulife Financial Inc.’s chief executive says COVID-19 had a  “significant” impact on the company’s second-quarter performance, but he’s confident it will bounce back.

Roy Gori told analysts Thursday that the pandemic negatively impacted sales and investments generated lower-than-expected returns as several countries the Toronto-based insurer operates in shut down to stop the spread of the novel coronavirus.

“The coronavirus continues to disrupt economies and capital markets worldwide,” Gori said in pre-taped remarks that opened the company’s quarterly call.

“Our operating conditions during the quarter were understandably effected.”

His remarks come a day after Manulife said COVID-19 hampered the company’s second quarter to the point where its net income dropped to half of what it was during the same period last year.

The insurer said its net income attributable to shareholders for the period ended June 30 was $727 million, just under half of the $1.47 billion it earned in the second quarter of 2019.

Manulife’s diluted earnings per common share reached 35 cents for the period, a fall from 73 cents a year ago but more than the eight cents per share analysts had expected.

The quarter, however, had some upsides.

Gori said he was pleased with Manulife’s efforts to launch a chatbot, offer e-applications for life insurance and begin non-face-to-face processes for sales in Asia amid the pandemic.

He also shared that the company had extended premium grace periods on several insurance products, launched a credit card deferral program and mortgage payment deferrals of up to six months.

How the pandemic will continue to impact Manulife and the economy, however, is a question mark, he said.

“It is still way too early to declare what the long-term consequences of COVID are and there are still way too many unknowns,” he said.

“I expect there is going to be a lot of uncertainty and volatility until we see an at-scale deployment of a vaccine and even then there are questions around how effective that vaccine will be.”

Manulife’s shares gains 84 cents or nearly 4.5 per cent at $19.67 in morning trading on the Toronto Stock Exchange.

This report by The Canadian Press was first published Aug. 6, 2020.

Companies in this story: (TSX:MFC)

Sun Life becomes minority owner of Montreal based telemedicine business Dialogue

MONTREAL _ Dialogue Technologies Inc. says it has formed a partnership with Sun Life Financial Inc. that will see the insurance provider become a minority owner of the telemedicine business.

Montreal-based Dialogue says the commercial partnership involves a $32.7-million equity investment and gives Sun Life rights to acquire additional equity later.

The announcement is part of a $43-million round of financing from Dialogue’s existing backers Caisse de depot et placement du Quebec, Portag3 Ventures, White Star Capital, HV Holtzbrinck Ventures, First Ascent Ventures and Walter Ventures.

Dialogue provides virtual access to medical care in Canada and connects users directly to health-care professionals across the globe at any time of day.

The company says the COVID-19 pandemic and physical distancing measures have triggered a sharp increase in usage of its virtual care services.

The deal comes after Sun Life rolled out access in April to Lumino Health Virtual Care, a platform powered by Dialogue that allows users to connect with medical professionals digitally.


Desjardins Group acquires two real estate brands from U.K. based firm

LEVIS, Que. _ Desjardins Group says it has reached a $60.5-million agreement with a U.K.-based hybrid real estate agency to acquire its Canadian holding company and its two brands.

The financial group says in a statement it will acquire the brands Purplebricks Canada and DuProprio from Purplebricks Group plc.’s holding company 9059-2114 Quebec Inc.

Purplebricks Canada provides fixed-fee real estate brokerage services for home sellers in three provinces, while DuProprio provides real estate services without an agent in Quebec.

The two companies have more than 500 employees in Quebec, Ontario, Manitoba and Alberta.

Desjardins, which is one of the largest mortgage and insurance providers in Quebec, says both will continue to be run by the existing teams.

It says the deal takes effect on Wednesday.

Birth of the largest mutual insurance company in the country with La Capitale/SSQ Insurance merger of equals

QUEBEC CITY, July 3, 2020 /CNW Telbec/ – La Capitale and SSQ Insurance are pleased to announce that their merger of equals is now official, creating the largest mutual insurance company in Canada with over 3.5 million members and clients.

The name of the new company will be announced in the fall and integration will take place gradually. For the time being, nothing is changing for members, clients, and business partners. All agreements are being maintained.

The company is built on a solid foundation: 4,700 committed employees, well-established mutualist values, sound finances, and diversified expertise. Assets under management total more than $20 billion, and premiums tally at $5 billion. Its head office will remain in Quebec City.

The new company is now the 1st group insurer in Quebec and 4th in Canada, as well as the 4th largest personal insurer in Quebec and the 6th largest in Canada. In general insurance, it ranks 3rd in Quebec and 13th in Canada. It also holds an enviable position in savings, ranking 7th in Canada in segregated funds.

Experienced, well-balanced management team
The new company is also announcing its management team. Jean-François Chalifoux, former CEO of SSQ Insurance, becomes President and CEO of the new company, whereas Jean St-Gelais, former Chairman of the Board and Chief Executive Officer of La Capitale, has been named Chairman of the Board of Directors. He will also lead the Integration Steering Committee.

The following people have joined the management team:

  • Pierre Marc Bellavance is appointed Executive Vice President and Leader, Legal Affairs, Compliance and Corporate Secretary. He served as Vice President, Legal Affairs and Corporate Secretary at La Capitale.
  • Patrick Cyr is appointed Executive Vice President and Leader, Integration. He was Senior Vice President, Finance at SSQ Insurance.
  • Catherine Desgagnés-Belzil is appointed Executive Vice President and Leader, Business Performance and Information Technology. She was previously Associate Secretary of the Treasury Board and Chief Information Officer for the Quebec government.
  • Christian Fournier is appointed Executive Vice President and Leader, Property and Casualty Insurance. He was Senior Executive Vice President and Chief Operating Officer at La Capitale General Insurance.
  • Mélissa Gilbert is appointed Executive Vice President and Leader, Finance. She was Executive Vice President, Finance, Corporate Actuarial and Risk Management at La Capitale.
  • Stéphane Morency is appointed Executive Vice President and Leader, Strategy, Customer Experience and Marketing. He was previously Senior Vice President, Strategy, Marketing and Client Experience within a major insurance and financial services group.
  • Lara Nourcy is appointed Executive Vice President and Leader, Individual Insurance and Financial Services. She was Vice President, Customers Experience, Partners and Operations Management at La Capitale.
  • Martin Robert is appointed Executive Vice President and Leader, Talent, Culture and Communication. He was previously Vice President, Talent, Culture and Communication at SSQ Insurance.
  • Éric Trudel has been appointed Executive Vice President and Leader, Group Insurance. He previously served as Senior Vice President, Strategy and Product Management at SSQ Insurance.

The merger of equals between La Capitale and SSQ Insurance was presented to members last January and has since gone through the various regulatory stages.

“We are very proud to make this merger of equals official today. Our new company has given itself the means to grow and make its mark in a fast-changing industry. We are now a major player across the country. We’ve opened an exciting new chapter for our 4,700 employees, who now make up the largest mutual insurance company in Canada.”

—  Jean-François Chalifoux, President and CEO
La Capitale/SSQ Insurance


SOURCE La Capitale Insurance and Financial Services

Great West subsidiary buying Personal Capital in deal worth at least US$825M

WINNIPEG _ A subsidiary of Great-West Lifeco Inc. has signed a deal to buy U.S. investment manager Personal Capital in a deal worth at least US$825 million.

Under the agreement, Empower Retirement will pay US$825 million, plus up to an additional US$175 million subject to the achievement of target growth objectives.

Great-West says Personal Capital is a hybrid wealth manager that combines a digital experience with personalized advice delivered by people.

The company says the deal will combine Empower retirement plan services and financial tools with Personal Capital’s digitally oriented personal wealth management platform.

IGM Financial Inc., a sister company to Great-West, holds a stake in Personal Capital and says it expects US$176.6 million in proceeds from the deal, plus up to an additional $24.6 million in possible additional payments.

The transaction is expected to close in the second half of 2020, subject to required regulatory approvals.


Desjardins to give $100M back to its Canadian auto insurance clients

MONTREAL, June 29, 2020 /CNW Telbec/ – Today, Desjardins’s property & casualty insurance subsidiaries announced they would be issuing $100 million in premium refunds to their Canadian auto insurance clients. The refunds are for eligible personal and commercial insurance clients, who will receive a refund between 25 per cent and 40 per cent of the premium they pay for one month, depending on their market realities. The refund will apply to policies for eligible personal and commercial vehicles.

All told, 2.1 million clients will automatically receive the refund through their usual payment method, so they don’t need to do anything.

More people are working from home than ever before. Combined with the extended lockdown, this means that travel has been limited and car accident risks have been reduced. Fewer accidents mean fewer claims to pay out, so Desjardins has decided to reflect this reality by issuing this refund to its clients.

“Even though we’re beginning to reopen our provinces and cities, the pandemic will continue to affect our members and clients. We’re proud to say that we’re still here for them in these unprecedented times. Right now, we’re able to give $100 million back to our auto insurance clients. This is just one of the many ways that Desjardins has helped its members and clients deal with COVID-19 since March 16,” said Guy Cormier, President and CEO of Desjardins Group.

Today’s announcement follows an initial refund of close to $50 million to auto insurance clients, bringing the total close to $150 million.

About Desjardins Group
Desjardins Group is the leading cooperative financial group in Canada and the sixth largest cooperative financial group in the world, with assets of $326.9 billion. It has been rated one of Canada’s Top 100 Employers by Mediacorp. To meet the diverse needs of its members and clients, Desjardins offers a full range of products and services to individuals and businesses through its extensive distribution network, online platforms and subsidiaries across Canada. Ranked among the world’s strongest banks according to The Banker magazine, Desjardins has some of the highest capital ratios and credit ratings in the industry.

SOURCE Desjardins Group

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